Endo International (ENDP) Strong On High Relative Volume Today

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

  • ENDP has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $144.9 million.
  • ENDP has traded 229,663 shares today.
  • ENDP is trading at 2.81 times the normal volume for the stock at this time of day.
  • ENDP is trading at a new high 3.04% above yesterday's close.

'Strong on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as M&A events, material stock news, analyst upgrades, insider buying, buying from 'superinvestors,' or that hedge funds and momentum traders are piling into 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. 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 ENDP:

Endo International plc, a specialty healthcare company, develops, manufactures, markets, and distributes branded pharmaceutical and generic products, and medical devices worldwide. Currently there are 10 analysts that rate Endo International a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for Endo International has been 2.2 million shares per day over the past 30 days. Endo International has a market cap of $10.2 billion and is part of the health care sector and drugs industry. The stock has a beta of 1.44 and a short float of 10% with 7.25 days to cover. Shares are down 0.6% 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 Endo International as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, generally higher debt management risk and disappointing return on equity.

Highlights from the ratings report include:
  • The revenue growth greatly exceeded the industry average of 8.7%. Since the same quarter one year prior, revenues rose by 25.9%. 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.
  • Net operating cash flow has significantly increased by 83.24% to $284.84 million when compared to the same quarter last year. In addition, ENDO INTERNATIONAL PLC has also vastly surpassed the industry average cash flow growth rate of -19.99%.
  • ENDO INTERNATIONAL PLC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from 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, ENDO INTERNATIONAL PLC continued to lose money by earning -$4.94 versus -$6.57 in the prior year. This year, the market expects an improvement in earnings ($4.24 versus -$4.94).
  • Currently the debt-to-equity ratio of 1.69 is quite high overall and when compared to the industry average, suggesting that the current management of debt levels should be re-evaluated. Along with the unfavorable debt-to-equity ratio, ENDP maintains a poor quick ratio of 0.87, which illustrates the inability to avoid short-term cash problems.
  • 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 Pharmaceuticals industry and the overall market, ENDO INTERNATIONAL PLC's return on equity significantly trails that of both the industry average and the S&P 500.

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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