Agios Pharmaceuticals (AGIO) Is Today's Water-Logged And Getting Wetter Stock

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 Agios Pharmaceuticals ( AGIO) as a "water-logged and getting wetter" (weak stocks crossing below support with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Agios Pharmaceuticals as such a stock due to the following factors:

  • AGIO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $135.0 million.
  • AGIO has traded 1.1 million shares today.
  • AGIO traded in a range 220% of the normal price range with a price range of $15.16.
  • AGIO traded below its daily resistance level (quality: 18 days, meaning that the stock is crossing a resistance level set by the last 18 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Water-Logged and Getting Wetter' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying negative price action. In this case, the stock crossed an important inflection point; namely, "support" while at the same time the range of the stock's movement in price is twice its normal size. This large range foreshadows a possible continuation as the stock moves lower.

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More details on AGIO:

Agios Pharmaceuticals, Inc., a biopharmaceutical company, focuses on the development and commercialization of therapeutics in the field of cancer metabolism and inborn errors of metabolism (IEMs) in the United States. Currently there are 2 analysts that rate Agios Pharmaceuticals a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Agios Pharmaceuticals has been 941,300 shares per day over the past 30 days. Agios has a market cap of $4.2 billion and is part of the health care sector and drugs industry. Shares are up 399.5% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Agios Pharmaceuticals as a sell. The company's weaknesses can be seen in multiple areas, such as its weak operating cash flow and poor profit margins.

Highlights from the ratings report include:
  • Net operating cash flow has significantly decreased to -$23.47 million or 56.65% 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 gross profit margin for AGIOS PHARMACEUTICALS is currently extremely low, coming in at 10.48%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, AGIO's net profit margin of 10.92% is significantly lower than the industry average.
  • AGIOS PHARMACEUTICALS reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. For the next year, the market is expecting a contraction of 37.7% in earnings (-$1.46 versus -$1.06).
  • Compared to other companies in the Biotechnology industry and the overall market, AGIOS PHARMACEUTICALS's return on equity significantly trails that of both the industry average and the S&P 500.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Biotechnology industry. The net income increased by 133.1% when compared to the same quarter one year prior, rising from -$11.18 million to $3.70 million.

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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