Trade-Ideas LLC identified

Pacira Pharmaceuticals

(

PCRX

) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Pacira Pharmaceuticals as such a stock due to the following factors:

  • PCRX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $25.1 million.
  • PCRX has traded 395,577 shares today.
  • PCRX traded in a range 219.6% of the normal price range with a price range of $3.67.
  • PCRX traded above its daily resistance level (quality: 54 days, meaning that the stock is crossing a resistance level set by the last 54 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Barbarian at the Gate' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in PCRX with the Ticky from Trade-Ideas. See the FREE profile for PCRX NOW at Trade-Ideas

More details on PCRX:

Pacira Pharmaceuticals, Inc., a specialty pharmaceutical company, develops, commercializes, and manufactures proprietary pharmaceutical products primarily for use in hospitals and ambulatory surgery centers in the United States. PCRX has a PE ratio of 39. Currently there are 6 analysts that rate Pacira Pharmaceuticals a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Pacira Pharmaceuticals has been 914,200 shares per day over the past 30 days. Pacira has a market cap of $1.4 billion and is part of the health care sector and drugs industry. The stock has a beta of 1.89 and a short float of 16.9% with 8.40 days to cover. Shares are down 52.8% year-to-date as of the close of trading on Friday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Pacira Pharmaceuticals as a

sell

. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Pharmaceuticals industry. The net income has significantly decreased by 405.9% when compared to the same quarter one year ago, falling from $1.26 million to -$3.85 million.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Pharmaceuticals industry and the overall market on the basis of return on equity, PACIRA PHARMACEUTICALS INC underperformed against that of the industry average and is significantly less than that of the S&P 500.
  • Net operating cash flow has significantly decreased to -$3.12 million or 733.06% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 37.18%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 433.33% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • The gross profit margin for PACIRA PHARMACEUTICALS INC is currently very high, coming in at 73.86%. Regardless of PCRX's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, PCRX's net profit margin of -5.88% significantly underperformed when compared to the industry average.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.