NEW YORK (TheStreet) -- IsoRay (ISR) recovered some of its losses from Friday, when the company priced its registered direct offering of common stock. The stock had surged more than 17% to a high of $2.52 as of 10:47 a.m. on Wednesday.
The company announced last week it had reached agreements with two institutional investors to sell 5,644,300 shares at $2.60 a share, which should yield gross proceeds of $14,675,180. IsoRay plans to use the proceeds for working capital and other corporate purposes.
IsoRay had surged to a new five-year high last week as it continued to benefit from its announcement of a major milestone in tumor treatment. IsoRay announced the world's first treatment of a tumor in a pediatric patient through the use of multiple Cesium-131 sutured seed meshes for internal radiation therapy. Dr. Anthony Crimaldi at Levine Cancer Institute in Charlotte successfully performed the implant using IsoRay Medical's Cesium-131 brachytherapy mesh.
The patient was a 12-year-old male with a type of childhood kidney tumor.
TheStreet Ratings team rates ISORAY INC as a "sell" with a ratings score of D-. TheStreet Ratings Team has this to say about their recommendation:
"We rate ISORAY INC (ISR) a SELL. This is driven by a few notable weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, weak operating cash flow and poor profit margins."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- 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, ISORAY INC's return on equity significantly trails that of both the industry average and the S&P 500.
- Net operating cash flow has decreased to -$0.85 million or 47.38% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- The gross profit margin for ISORAY INC is currently extremely low, coming in at 14.38%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, ISR's net profit margin of -85.43% significantly underperformed when compared to the industry average.
- ISORAY INC has improved earnings per share by 33.3% in the most recent quarter compared to the same quarter a year ago. Stable earnings per share over the past two years indicate the company has managed its earnings and share float. We anticipate this stability to falter in the coming year and, in turn, the company to deliver lower earnings per share than the prior full year. During the past fiscal year, ISORAY INC continued to lose money by earning -$0.11 versus -$0.12 in the prior year. For the next year, the market is expecting a contraction of 18.2% in earnings (-$0.13 versus -$0.11).
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Biotechnology industry average. The net income increased by 19.7% when compared to the same quarter one year prior, going from -$1.16 million to -$0.93 million.
- You can view the full analysis from the report here: ISR Ratings Report