NEW YORK (TheStreet) -- Acorda Therapeutics (ACOR) - Get Report shares are climbing 12.3% to $32.96 on Wednesday after the drug maker announced that it is buying Civitas Therapeutics for $525 million in cash, nixing Civitas previous plans to go public.
The deal gives Acorda Therapeutics the rights to Civitas Phase 3 Parkinson's disease treatment CVT-301, the company's pulmonary delivery technology, and a manufacturing facility in Chelsea, MA.STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.
TheStreet Ratings team rates ACORDA THERAPEUTICS INC as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate ACORDA THERAPEUTICS INC (ACOR) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels, good cash flow from operations, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth significantly trails the industry average of 43.1%. Since the same quarter one year prior, revenues rose by 11.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- Net operating cash flow has significantly increased by 125.16% to $18.71 million when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 100.84%.
- The gross profit margin for ACORDA THERAPEUTICS INC is currently very high, coming in at 82.30%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, ACOR's net profit margin of 4.82% significantly trails the industry average.
- Despite currently having a low debt-to-equity ratio of 0.57, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 6.69 is very high and demonstrates very strong liquidity.
- You can view the full analysis from the report here: ACOR Ratings Report