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 Alnylam Pharmaceuticals ( ALNY) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Alnylam Pharmaceuticals as such a stock due to the following factors:

  • ALNY has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $79.2 million.
  • ALNY has traded 61,782 shares today.
  • ALNY is trading at 3.06 times the normal volume for the stock at this time of day.
  • ALNY is trading at a new low 4.01% 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 ALNY:

Alnylam Pharmaceuticals, Inc., a biopharmaceutical company, discovers, develops, and commercializes novel therapeutics based on RNA interference. Currently there are 8 analysts that rate Alnylam Pharmaceuticals a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Alnylam Pharmaceuticals has been 713,300 shares per day over the past 30 days. Alnylam has a market cap of $10.1 billion and is part of the health care sector and drugs industry. The stock has a beta of 1.80 and a short float of 8.6% with 6.39 days to cover. Shares are up 21.1% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Alnylam Pharmaceuticals as a sell. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity and weak operating cash flow.

Highlights from the ratings report include:
  • 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 Biotechnology industry and the overall market, ALNYLAM PHARMACEUTICALS INC'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 -$36.64 million or 63.77% 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 33.9% when compared to the same quarter one year prior, rising from -$32.36 million to -$21.39 million.
  • ALNYLAM PHARMACEUTICALS INC has improved earnings per share by 45.1% 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, ALNYLAM PHARMACEUTICALS INC reported poor results of -$5.14 versus -$1.43 in the prior year. This year, the market expects an improvement in earnings (-$3.01 versus -$5.14).
  • This stock has increased by 61.66% 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 ALNY do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.

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