Shire (SHPG) Is Today's Pre-Market Laggard Stock

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 Shire ( SHPG) as a pre-market laggard candidate. In addition to specific proprietary factors, Trade-Ideas identified Shire as such a stock due to the following factors:

  • SHPG has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $399.1 million.
  • SHPG traded 28,300 shares today in the pre-market hours as of 7:28 AM.
  • SHPG is down 4.3% today from yesterday's close.

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More details on SHPG:

Shire plc, a biopharmaceutical company, together with its subsidiaries, researches, develops, licenses, manufactures, markets, distributes, and sells pharmaceutical products. The stock currently has a dividend yield of 0.2%. SHPG has a PE ratio of 67.4. Currently there are 4 analysts that rate Shire a buy, no analysts rate it a sell, and 6 rate it a hold.

The average volume for Shire has been 1.3 million shares per day over the past 30 days. Shire has a market cap of $48.7 billion and is part of the health care sector and drugs industry. Shares are up 76.6% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Shire as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, impressive record of earnings per share growth, compelling growth in net income, notable return on equity and good cash flow from operations. We feel these strengths outweigh the fact that the company is trading at a premium valuation based on our review of its current price compared to such things as earnings and book value.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 5.4%. Since the same quarter one year prior, revenues rose by 19.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • SHIRE PLC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, SHIRE PLC increased its bottom line by earning $7.37 versus $3.89 in the prior year. This year, the market expects an improvement in earnings ($9.91 versus $7.37).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Pharmaceuticals industry. The net income increased by 102.7% when compared to the same quarter one year prior, rising from $258.10 million to $523.10 million.
  • 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 Pharmaceuticals industry and the overall market, SHIRE PLC's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly increased by 222.50% to $834.00 million when compared to the same quarter last year. In addition, SHIRE PLC has also vastly surpassed the industry average cash flow growth rate of -66.20%.

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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