Perilous Reversal Stock: Halozyme Therapeutics (HALO)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Halozyme Therapeutics ( HALO) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Halozyme Therapeutics as such a stock due to the following factors:

  • HALO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $34.7 million.
  • HALO has traded 91,404 shares today.
  • HALO is down 3.4% today.
  • HALO was up 7.5% yesterday.

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More details on HALO:

Halozyme Therapeutics, Inc., a biopharmaceutical company, engages in the research, development, and commercialization of human enzymes. Currently there are 2 analysts that rate Halozyme Therapeutics a buy, 1 analyst rates it a sell, and 3 rate it a hold.

The average volume for Halozyme Therapeutics has been 1.6 million shares per day over the past 30 days. Halozyme has a market cap of $1.5 billion and is part of the health care sector and drugs industry. The stock has a beta of 2.03 and a short float of 13.9% with 4.84 days to cover. Shares are down 12.3% year-to-date as of the close of trading on Thursday.

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

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Halozyme Therapeutics as a sell. Among the areas we feel are negative, one of the most important has been the company's poor growth in earnings per share.

Highlights from the ratings report include:
  • HALOZYME THERAPEUTICS INC has improved earnings per share by 5.5% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, HALOZYME THERAPEUTICS INC reported poor results of -$0.49 versus -$0.20 in the prior year. For the next year, the market is expecting a contraction of 51.0% in earnings (-$0.74 versus -$0.49).
  • The company, on the basis of net income growth from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and the Biotechnology industry average. The net income increased by 3.6% when compared to the same quarter one year prior, going from -$20.01 million to -$19.29 million.
  • Investors have driven up the company's shares by 99.08% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the future course of this stock, we feel that the risks involved in investing in HALO do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.
  • Net operating cash flow has increased to -$12.41 million or 13.17% when compared to the same quarter last year. In addition, HALOZYME THERAPEUTICS INC has also vastly surpassed the industry average cash flow growth rate of -38.82%.
  • HALO's very impressive revenue growth greatly exceeded the industry average of 12.7%. Since the same quarter one year prior, revenues leaped by 200.2%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.

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

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