Arena Pharmaceuticals Inc. (ARNA): Today's Featured Health Care Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Arena Pharmaceuticals ( ARNA) pushed the Health Care sector lower today making it today's featured Health Care laggard. The sector as a whole closed the day up 0.5%. By the end of trading, Arena Pharmaceuticals fell 8 cents (-1.1%) to $7.83 on average volume. Throughout the day, 8.6 million shares of Arena Pharmaceuticals exchanged hands as compared to its average daily volume of 10.5 million shares. The stock ranged in price between $7.73-$8.03 after having opened the day at $8 as compared to the previous trading day's close of $7.91. Other companies within the Health Care sector that declined today were: Pain Therapeutics ( PTIE), down 36.6%, Durect Corporation ( DRRX), down 33.6%, Abiomed ( ABMD), down 31.3%, and Graymark Healthcare ( GRMH), down 23.1%.
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Arena Pharmaceuticals, Inc., a clinical-stage biopharmaceutical company, engages in discovering, developing, and commercializing oral drugs that target G protein-coupled receptors in the therapeutic areas of cardiovascular, central nervous system, inflammatory, and metabolic diseases. Arena Pharmaceuticals has a market cap of $1.83 billion and is part of the drugs industry. The company has a P/E ratio of -14.1, below the S&P 500 P/E ratio of 17.7. Shares are up 352.4% year to date as of the close of trading on Wednesday. Currently there are two analysts that rate Arena Pharmaceuticals a buy, one analyst rates it a sell, and six rate it a hold.

TheStreet Ratings rates Arena Pharmaceuticals as a sell. Among the areas we feel are negative, one of the most important has been poor profit margins.

On the positive front, Novogen ( NVGN), up 32.7%, Gentiva Health Services ( GTIV), up 21.2%, Prestige Brands Holdings ( PBH), up 18.5%, and Savient Pharmaceuticals ( SVNT), up 17.9%, were all gainers within the health care sector with Aetna ( AET) being today's featured health care sector leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the health care sector could consider Health Care Select Sector SPDR ( XLV) while those bearish on the health care sector could consider ProShares Ultra Short Health Care ( RXD).

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