Karyopharm Therapeutics (KPTI) 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.

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

  • KPTI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $8.8 million.
  • KPTI has traded 53,904 shares today.
  • KPTI is trading at 4.50 times the normal volume for the stock at this time of day.
  • KPTI is trading at a new low 6.27% 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 KPTI:

Karyopharm Therapeutics Inc., a clinical-stage pharmaceutical company, focuses on the discovery and development of drugs directed against nuclear transport targets for the treatment of cancer and other major diseases. Currently there are 3 analysts that rate Karyopharm Therapeutics a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Karyopharm Therapeutics has been 337,300 shares per day over the past 30 days. Karyopharm has a market cap of $1.1 billion and is part of the health care sector and drugs industry. Shares are down 19.2% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Karyopharm Therapeutics as a sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income and poor profit margins.

Highlights from the ratings report include:
  • KARYOPHARM THERAPEUTICS INC 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. Earnings per share have declined over the last year. We anticipate that this should continue in the coming year. During the past fiscal year, KARYOPHARM THERAPEUTICS INC reported poor results of -$2.41 versus -$0.74 in the prior year. For the next year, the market is expecting a contraction of 29.9% in earnings (-$3.13 versus -$2.41).
  • 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 90.3% when compared to the same quarter one year ago, falling from -$13.69 million to -$26.07 million.
  • The gross profit margin for KARYOPHARM THERAPEUTICS INC is currently extremely low, coming in at 0.00%. Despite the low profit margin, it has increased significantly from the same period last year.
  • KPTI, with its very weak revenue results, has greatly underperformed against the industry average of 20.1%. Since the same quarter one year prior, revenues plummeted by 100.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • Compared to where it was a year ago, the stock is now trading at a higher level, and has traded in line with the S&P 500. Turning our attention to the future direction of the stock, we do not believe this stock offers ample reward opportunity to compensate for the risks, despite the fact that it rose over the past year.

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