NEW YORK (TheStreet) -- Shares of Novavax (NVAX) are down -6.86% to $4.24 in early trading on Friday.
The biotech company priced its public offering of 25 million shares of common stock at $4.00 per share, which is a 12% discount to Thursday's closing price of $4.69, according to TheStreet.com columnist Adam Feuerstein.
"We rate NOVAVAX INC (NVAX) a SELL. This is driven by multiple 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 deteriorating net income and weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Biotechnology industry. The net income has significantly decreased by 38.1% when compared to the same quarter one year ago, falling from -$10.00 million to -$13.81 million.
- Net operating cash flow has significantly decreased to -$20.43 million or 93.05% 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 company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Biotechnology industry and the overall market, NOVAVAX INC's return on equity significantly trails that of both the industry average and the S&P 500.
- NOVAVAX INC reported flat earnings per share in the most recent quarter. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, NOVAVAX INC reported poor results of -$0.31 versus -$0.22 in the prior year. This year, the market expects an improvement in earnings (-$0.27 versus -$0.31).
- The gross profit margin for NOVAVAX INC is currently very high, coming in at 72.65%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -185.07% is in-line with the industry average.
- You can view the full analysis from the report here: NVAX Ratings Report