NEW YORK (TheStreet) -- POZEN (POZN) shares are down -6.5% to $8.27 on Wednesday after the FDA announced that the company's resubmission of its new drug application (NDA) for its secondary cardiovascular disease prevention treatments, PA8140 and PA32540, would be classified as a Class 2, meaning its new user fee goal date is December 30, 2014.
TheStreet Ratings team rates POZEN INC as a Hold with a ratings score of C-. TheStreet Ratings Team has this to say about their recommendation:
"We rate POZEN INC (POZN) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we find that the company's return on equity has been disappointing."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- POZN's very impressive revenue growth greatly exceeded the industry average of 5.6%. Since the same quarter one year prior, revenues leaped by 433.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
- POZN has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 2.99, which clearly demonstrates the ability to cover short-term cash needs.
- Net operating cash flow has increased to -$6.06 million or 14.73% when compared to the same quarter last year. In addition, POZEN INC has also modestly surpassed the industry average cash flow growth rate of 10.91%.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Pharmaceuticals industry and the overall market, POZEN INC's return on equity significantly trails that of both the industry average and the S&P 500.
- You can view the full analysis from the report here: POZN Ratings Report