XOMA (XOMA) Stock: Weak On High 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 XOMA ( XOMA) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified XOMA as such a stock due to the following factors:

  • XOMA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $18.5 million.
  • XOMA has traded 432,723 shares today.
  • XOMA is trading at 3.60 times the normal volume for the stock at this time of day.
  • XOMA is trading at a new low 3.14% 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 XOMA:

XOMA Corporation discovers and develops antibody-based therapeutics in the United States, Europe, and the Asia Pacific. Currently there are 5 analysts that rate XOMA a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for XOMA has been 1.7 million shares per day over the past 30 days. XOMA has a market cap of $611.1 million and is part of the health care sector and drugs industry. The stock has a beta of 4.43 and a short float of 14.9% with 2.79 days to cover. Shares are down 17.4% 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 XOMA as a sell. Among the areas we feel are negative, one of the most important has been weak operating cash flow.

Highlights from the ratings report include:
  • Net operating cash flow has decreased to -$15.80 million or 23.18% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • 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 51.4% when compared to the same quarter one year prior, rising from -$29.62 million to -$14.40 million.
  • The revenue fell significantly faster than the industry average of 40.4%. Since the same quarter one year prior, revenues fell by 18.6%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • XOMA CORP 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, XOMA CORP reported poor results of -$1.40 versus -$1.29 in the prior year. This year, the market expects an improvement in earnings (-$0.47 versus -$1.40).
  • This stock has increased by 33.17% 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 XOMA do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.

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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