3 Stocks Improving Performance Of The Drugs Industry

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.

All three major indices are trading down today with the Dow Jones Industrial Average ( ^DJI) trading down 42.44 points (-0.2%) at 17,080 as of Thursday, Aug. 28, 2014, 4:20 PM ET. The NYSE advances/declines ratio sits at 1,267 issues advancing vs. 1,750 declining with 176 unchanged.

The Drugs industry as a whole closed the day down 0.3% versus the S&P 500, which was down 0.2%. Top gainers within the Drugs industry included Aoxing Pharmaceutical ( AXN), up 2.7%, XTL Biopharmaceuticals ( XTLB), up 5.1%, Prima Biomed ( PBMD), up 1.9%, Cellectar Biosciences ( CLRB), up 1.6% and Evoke Pharma ( EVOK), up 2.7%.

TheStreet Ratings Group would like to highlight 3 stocks pushing the industry higher today:

Cellectar Biosciences ( CLRB) is one of the companies that pushed the Drugs industry higher today. Cellectar Biosciences was up $0.05 (1.6%) to $3.25 on heavy volume. Throughout the day, 49,994 shares of Cellectar Biosciences exchanged hands as compared to its average daily volume of 13,300 shares. The stock ranged in a price between $3.17-$3.35 after having opened the day at $3.29 as compared to the previous trading day's close of $3.20.

Cellectar Biosciences has a market cap of $9.3 million and is part of the health care sector. Shares are unchanged year-to-date as of the close of trading on Wednesday.

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At the close, XTL Biopharmaceuticals ( XTLB) was up $0.11 (5.1%) to $2.26 on light volume. Throughout the day, 333 shares of XTL Biopharmaceuticals exchanged hands as compared to its average daily volume of 4,700 shares. The stock ranged in a price between $2.24-$2.26 after having opened the day at $2.24 as compared to the previous trading day's close of $2.15.

XTL Biopharmaceuticals Ltd., a biopharmaceutical company, is engaged in the acquisition and development of pharmaceutical products for the treatment of unmet medical needs. XTL Biopharmaceuticals has a market cap of $25.0 million and is part of the health care sector. Shares are down 25.9% year-to-date as of the close of trading on Wednesday. Currently there are no analysts who rate XTL Biopharmaceuticals a buy, 1 analyst rates it a sell, and none rate it a hold.

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TheStreet Ratings rates XTL Biopharmaceuticals as a sell. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on XTLB go as follows:

  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Biotechnology industry and the overall market, XTL BIOPHARMACEUTICALS's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has decreased to -$0.80 million or 44.12% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • XTLB's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 63.21%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Biotechnology industry average, but is greater than that of the S&P 500. The net income increased by 21.3% when compared to the same quarter one year prior, going from -$0.87 million to -$0.69 million.
  • The revenue fell significantly faster than the industry average of 43.4%. Since the same quarter one year prior, revenues fell by 12.8%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.

You can view the full analysis from the report here: XTL Biopharmaceuticals Ratings Report

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

Aoxing Pharmaceutical ( AXN) was another company that pushed the Drugs industry higher today. Aoxing Pharmaceutical was up $0.01 (2.7%) to $0.30 on light volume. Throughout the day, 3,960 shares of Aoxing Pharmaceutical exchanged hands as compared to its average daily volume of 23,300 shares. The stock ranged in a price between $0.29-$0.31 after having opened the day at $0.30 as compared to the previous trading day's close of $0.29.

Aoxing Pharmaceutical Company, Inc., a specialty pharmaceutical company, researches, develops, manufactures, and distributes various narcotic, pain-management, and addiction treatment pharmaceutical products primarily in the People's Republic of China. Aoxing Pharmaceutical has a market cap of $14.2 million and is part of the health care sector. Shares are up 16.2% year-to-date as of the close of trading on Wednesday. Currently there are no analysts who rate Aoxing Pharmaceutical a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates Aoxing Pharmaceutical as a sell. Among the areas we feel are negative, one of the most important has been weak operating cash flow.

Highlights from TheStreet Ratings analysis on AXN go as follows:

  • Net operating cash flow has decreased to -$4.35 million or 41.91% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • AOXING PHARMACEUTICAL CO INC has improved earnings per share by 20.0% in the most recent quarter compared to the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, AOXING PHARMACEUTICAL CO INC reported poor results of -$0.34 versus -$0.32 in the prior year.
  • 43.50% is the gross profit margin for AOXING PHARMACEUTICAL CO INC which we consider to be strong. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, AXN's net profit margin of -74.48% significantly underperformed when compared to the industry average.
  • Investors have driven up the company's shares by 42.83% 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 AXN do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.
  • 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 29.8% when compared to the same quarter one year prior, rising from -$2.60 million to -$1.82 million.

You can view the full analysis from the report here: Aoxing Pharmaceutical Ratings Report

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

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.

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