BioDelivery Sciences International (BDSI) Highlighted As Weak On High Volume

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 BioDelivery Sciences International ( BDSI) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified BioDelivery Sciences International as such a stock due to the following factors:

  • BDSI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $24.6 million.
  • BDSI has traded 323,125 shares today.
  • BDSI is trading at 5.09 times the normal volume for the stock at this time of day.
  • BDSI is trading at a new low 6.03% below yesterday's close.

'Weak on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as material stock news, analyst downgrades, insider selling, selling from 'superinvestors,' or that hedge funds and traders are piling out of a stock ahead of a catalyst. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize (or avoid losses by trimming weak positions). In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.

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More details on BDSI:

BioDelivery Sciences International, Inc., a specialty pharmaceutical company, develops and commercializes therapeutics in the areas of pain management and oncology supportive care. Currently there are 5 analysts that rate BioDelivery Sciences International a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for BioDelivery Sciences International has been 1.1 million shares per day over the past 30 days. BioDelivery Sciences International has a market cap of $820.8 million and is part of the health care sector and drugs industry. The stock has a beta of 2.57 and a short float of 9% with 2.78 days to cover. Shares are up 172.8% year-to-date as of the close of trading on Wednesday.

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

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates BioDelivery Sciences International as a sell. The area that we feel has been the company's primary weakness has been its disappointing return on equity.

Highlights from the ratings report include:
  • 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 Pharmaceuticals industry and the overall market, BIODELIVERY SCIENCES INTL's return on equity significantly trails that of both the industry average and the S&P 500.
  • BIODELIVERY SCIENCES INTL reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, BIODELIVERY SCIENCES INTL reported poor results of -$1.51 versus -$0.04 in the prior year. This year, the market expects an improvement in earnings (-$0.71 versus -$1.51).
  • 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 50.3% when compared to the same quarter one year prior, rising from -$13.42 million to -$6.67 million.
  • This stock has increased by 236.26% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the future course of this stock, we feel that the risks involved in investing in BDSI do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.
  • BDSI's debt-to-equity ratio is very low at 0.25 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 3.15, which clearly demonstrates the ability to cover short-term cash needs.

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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