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

  • IDRA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $7.2 million.
  • IDRA has traded 273,254 shares today.
  • IDRA is trading at 2.55 times the normal volume for the stock at this time of day.
  • IDRA is trading at a new low 3.12% 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 IDRA:

Idera Pharmaceuticals, Inc., a clinical-stage biopharmaceutical company, focuses on the discovery, development, and commercialization of novel therapeutics for oncology and rare diseases in the United States. Currently there are 2 analysts that rate Idera Pharmaceuticals a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Idera Pharmaceuticals has been 1.9 million shares per day over the past 30 days. Idera has a market cap of $424.4 million and is part of the health care sector and drugs industry. The stock has a beta of 2.59 and a short float of 18.4% with 9.32 days to cover. Shares are down 12.9% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

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

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 39.3% when compared to the same quarter one year ago, falling from -$8.96 million to -$12.48 million.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Biotechnology industry and the overall market, IDERA 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 -$12.71 million or 67.17% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • Looking at where the stock is today compared to one year ago, we find that it is higher, and it has outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. 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.
  • IDERA PHARMACEUTICALS INC reported flat earnings per share in the most recent quarter. 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, IDERA PHARMACEUTICALS INC continued to lose money by earning -$0.47 versus -$0.51 in the prior year. This year, the market expects an improvement in earnings (-$0.45 versus -$0.47).

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