Anika Therapeutics (ANIK) In A Perilous Reversal

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

  • ANIK has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $37.3 million.
  • ANIK has traded 52,554 shares today.
  • ANIK is down 5.9% today.
  • ANIK was up 33.2% yesterday.

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More details on ANIK:

Anika Therapeutics, Inc., together with its subsidiaries, develops, manufactures, and commercializes therapeutic products for tissue protection, healing, and repair. Its products are based on hyaluronic acid (HA), a naturally occurring biocompatible polymer found in the body. ANIK has a PE ratio of 27.4.

The average volume for Anika Therapeutics has been 305,800 shares per day over the past 30 days. Anika has a market cap of $476.7 million and is part of the health care sector and drugs industry. The stock has a beta of 1.77 and a short float of 5.8% with 0.76 days to cover. Shares are down 9.6% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Anika Therapeutics as a buy. 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, notable return on equity, expanding profit margins and good cash flow from operations. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

Highlights from the ratings report include:
  • The revenue growth greatly exceeded the industry average of 26.2%. Since the same quarter one year prior, revenues rose by 20.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • ANIK's debt-to-equity ratio is very low at 0.07 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 7.78, which clearly demonstrates the ability to cover short-term cash needs.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Health Care Equipment & Supplies industry and the overall market, ANIKA THERAPEUTICS INC's return on equity exceeds that of both the industry average and the S&P 500.
  • The gross profit margin for ANIKA THERAPEUTICS INC is currently very high, coming in at 77.08%. It has increased significantly from the same period last year. Along with this, the net profit margin of 27.91% significantly outperformed against the industry average.
  • Net operating cash flow has significantly increased by 241.78% to $7.53 million when compared to the same quarter last year. In addition, ANIKA THERAPEUTICS INC has also vastly surpassed the industry average cash flow growth rate of -20.04%.

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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