Trifecta Stocks' Bryan Ashenberg and Bob Lang noted that Horizon Pharma has had an extremely successful year so far as the company has more than doubled its trading value over the past 12 months.
The analysts see last week's pull back to a low of $27.62 as a buying opportunity as their analysis of the company's chart suggests that it is poised to jump again in the coming months.
This name is up well over 100% year-to-date. As we see from the chart, the uptrend line is still intact after the recent pullback, and now it appears the stock is ready to go again.
The gap from late March is good support. Volume trends have been very positive and the Moving Average Convergence Divergence corrected enough (circled) and is moving positively. The Relative Strength Index held at the 50 level, a prior spot where a new uptrend would occur.
TheStreet Ratings team rates HORIZON PHARMA PLC as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:
"We rate HORIZON PHARMA PLC (HZNP) a SELL. This is driven by a number of negative factors, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. Among the areas we feel are negative, one of the most important has been weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Net operating cash flow has significantly decreased to -$70.74 million or 9244.64% 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 HORIZON PHARMA PLC is currently very high, coming in at 93.49%. Regardless of HZNP's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, HZNP's net profit margin of -17.28% significantly underperformed when compared to the industry average.
- Compared to other companies in the Pharmaceuticals industry and the overall market, HORIZON PHARMA PLC's return on equity significantly trails that of both the industry average and the S&P 500.
- HORIZON PHARMA PLC 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, HORIZON PHARMA PLC reported poor results of -$3.70 versus -$2.29 in the prior year. This year, the market expects an improvement in earnings ($1.23 versus -$3.70).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Pharmaceuticals industry. The net income increased by 90.5% when compared to the same quarter one year prior, rising from -$206.25 million to -$19.55 million.
- You can view the full analysis from the report here: HZNP Ratings Report