Onyx Pharmaceuticals Inc. Stock Hold Recommendation Reiterated (ONXX)

NEW YORK ( TheStreet) -- Onyx Pharmaceuticals (Nasdaq: ONXX) has been reiterated by TheStreet Ratings as a hold with a ratings score of C-. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity and weak operating cash flow.

Highlights from the ratings report include:
  • ONXX's very impressive revenue growth greatly exceeded the industry average of 43.4%. Since the same quarter one year prior, revenues leaped by 102.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • ONXX's debt-to-equity ratio is very low at 0.15 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 8.43, which clearly demonstrates the ability to cover short-term cash needs.
  • ONYX PHARMACEUTICALS INC has improved earnings per share by 46.6% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, ONYX PHARMACEUTICALS INC swung to a loss, reporting -$2.92 versus $0.94 in the prior year. This year, the market expects an improvement in earnings (-$1.67 versus -$2.92).
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Biotechnology industry and the overall market, ONYX PHARMACEUTICALS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly decreased to -$111.17 million or 150.59% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

Onyx Pharmaceuticals, Inc., a biopharmaceutical company, engages in the development and commercialization of therapies that target the molecular mechanisms that cause cancer in the United States and internationally. Onyx has a market cap of $6.2 billion and is part of the health care sector and drugs industry. Shares are up 12.8% year to date as of the close of trading on Friday.

You can view the full Onyx Ratings Report or get investment ideas from our investment research center.

--Written by a member of TheStreet Ratings Staff.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.
null

If you liked this article you might like

Biotech Stock Mailbag: Rebounding From Hillary's Drug Tweet; Global Blood Weighs on Bluebird

The Street Can't Help but Love Amgen

Biotech Stock Bubble Talk Deflated By Cost-Conscious Buyers

Trade-Ideas: Onyx Pharmaceuticals (ONXX) Is Today's "Water-Logged And Getting Wetter" Stock

Jim Cramer's 'Mad Money' Recap: Next Week's Game Plan