3 Drugs Stocks Nudging The Industry Higher

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All three major indices traded up today with the Dow Jones Industrial Average ( ^DJI) trading up 154 points (0.9%) at 17,210 as of Wednesday, Sept. 24, 2014, 4:20 PM ET. The NYSE advances/declines ratio sits at 1,794 issues advancing vs. 1,244 declining with 169 unchanged.

The Drugs industry as a whole closed the day up 1.3% versus the S&P 500, which was up 0.8%. Top gainers within the Drugs industry included China Pharma ( CPHI), up 3.9%, Oragenics ( OGEN), up 2.3%, ImmuCell ( ICCC), up 2.1%, Celsus Therapeutics ( CLTX), up 5.7% and Merus Labs International ( MSLI), up 6.9%.

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

Merus Labs International ( MSLI) is one of the companies that pushed the Drugs industry higher today. Merus Labs International was up $0.10 (6.9%) to $1.54 on heavy volume. Throughout the day, 45,052 shares of Merus Labs International exchanged hands as compared to its average daily volume of 22,700 shares. The stock ranged in a price between $1.44-$1.57 after having opened the day at $1.46 as compared to the previous trading day's close of $1.44.

Merus Labs International Inc., a specialty pharmaceutical company, is engaged in the acquisition and licensing of branded prescription medicines in the United States, Canada, and Europe. Merus Labs International has a market cap of $139.4 million and is part of the health care sector. Shares are up 26.8% year-to-date as of the close of trading on Tuesday. Currently there are no analysts who rate Merus Labs International a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates Merus Labs International as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, compelling growth in net income and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we find that the company's return on equity has been disappointing.

Highlights from TheStreet Ratings analysis on MSLI go as follows:

  • This stock has managed to rise its share value by 76.92% over the past twelve months. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
  • 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 83.6% when compared to the same quarter one year prior, rising from -$1.05 million to -$0.17 million.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 4.7%. Since the same quarter one year prior, revenues slightly dropped by 4.4%. Weakness in the company's revenue seems to not be hurting the bottom line, shown by stable earnings per share.
  • The gross profit margin for MERUS LABS INTERNATIONAL INC is currently very high, coming in at 80.97%. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, MSLI's net profit margin of -2.39% significantly underperformed when compared to the industry average.
  • 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, MERUS LABS INTERNATIONAL INC's return on equity significantly trails that of both the industry average and the S&P 500.

You can view the full analysis from the report here: Merus Labs International Ratings Report

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