Perilous Reversal Stock: Celldex Therapeutics (CLDX)

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 Celldex Therapeutics ( CLDX) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Celldex Therapeutics as such a stock due to the following factors:

  • CLDX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $85.5 million.
  • CLDX has traded 552,211 shares today.
  • CLDX is down 4.1% today.
  • CLDX was up 28.9% yesterday.

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More details on CLDX:

Celldex Therapeutics, Inc., a biopharmaceutical company, focuses on the development, manufacture, and commercialization of novel therapeutics for human health care primarily in the United States. Currently there are 7 analysts that rate Celldex Therapeutics a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Celldex Therapeutics has been 2.0 million shares per day over the past 30 days. Celldex has a market cap of $1.3 billion and is part of the health care sector and drugs industry. The stock has a beta of 3.48 and a short float of 26.1% with 4.10 days to cover. Shares are down 24.6% year-to-date as of the close of trading on Monday.

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 Celldex Therapeutics as a sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:
  • CELLDEX THERAPEUTICS INC's earnings per share declined by 6.9% in the most recent quarter compared to the same quarter a year ago. Stable earnings per share over the past year indicate the company has managed its earnings and share float. We anticipate this stability to falter in the coming year and, in turn, the company to deliver lower earnings per share than prior full year. During the past fiscal year, CELLDEX THERAPEUTICS INC reported poor results of -$1.03 versus -$1.02 in the prior year. For the next year, the market is expecting a contraction of 27.7% in earnings (-$1.32 versus -$1.03).
  • 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 decreased by 21.4% when compared to the same quarter one year ago, dropping from -$23.14 million to -$28.08 million.
  • Looking at the price performance of CLDX's shares over the past 12 months, there is not much good news to report: the stock is down 44.30%, and it has underformed the S&P 500 Index. In addition, the company's earnings per share are lower today than the year-earlier 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 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 Biotechnology industry and the overall market, CELLDEX THERAPEUTICS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • CLDX's revenue growth trails the industry average of 41.4%. Since the same quarter one year prior, revenues rose by 12.3%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.

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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