Tekmira Pharmaceuticals (TKMR) Highlighted As Today's Perilous Reversal 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.

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

  • TKMR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $13.4 million.
  • TKMR has traded 57,726 shares today.
  • TKMR is down 4% today.
  • TKMR was up 8.5% yesterday.

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More details on TKMR:

Tekmira Pharmaceuticals Corporation, a biopharmaceutical company, focuses on the research and development of RNA interference therapeutics; and provides lipid nanoparticle delivery technology to pharmaceutical partners in Canada. Currently there are 5 analysts that rate Tekmira Pharmaceuticals a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Tekmira Pharmaceuticals has been 1.0 million shares per day over the past 30 days. Tekmira has a market cap of $858.7 million and is part of the health care sector and drugs industry. Shares are up 32% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Tekmira Pharmaceuticals as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:
  • 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 significantly decreased by 41.4% when compared to the same quarter one year ago, falling from -$6.08 million to -$8.60 million.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Biotechnology industry and the overall market, TEKMIRA PHARMACEUTICALS CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly decreased to -$6.72 million or 78.91% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • TKMR's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 40.43%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last 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.
  • TEKMIRA PHARMACEUTICALS CORP has improved earnings per share by 7.1% in the most recent quarter compared to the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, TEKMIRA PHARMACEUTICALS CORP swung to a loss, reporting -$0.96 versus $1.87 in the prior year.

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