Trade-Ideas: Cormedix (CRMD) Is Today's Weak On High Relative Volume 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 Cormedix ( CRMD) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Cormedix as such a stock due to the following factors:

  • CRMD has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $4.4 million.
  • CRMD has traded 102,531 shares today.
  • CRMD is trading at 2.24 times the normal volume for the stock at this time of day.
  • CRMD is trading at a new low 7.01% 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 CRMD:

CorMedix Inc., a pharmaceutical company, intends to in-license, develop, and commercialize therapeutic products for the prevention and treatment of cardiac, renal, and infectious diseases. Currently there are no analysts that rate Cormedix a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Cormedix has been 1.0 million shares per day over the past 30 days. Cormedix has a market cap of $216.7 million and is part of the health care sector and drugs industry. The stock has a beta of -6.03 and a short float of 13.1% with 4.36 days to cover. Shares are up 265.4% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Cormedix as a sell. Among the areas we feel are negative, one of the most important has been weak operating cash flow.

Highlights from the ratings report include:
  • Net operating cash flow has significantly decreased to -$1.57 million or 70.34% 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 35.5% when compared to the same quarter one year prior, rising from -$3.44 million to -$2.21 million.
  • CORMEDIX INC 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, CORMEDIX INC reported poor results of -$1.24 versus -$0.67 in the prior year. This year, the market expects an improvement in earnings (-$0.55 versus -$1.24).
  • Compared to other companies in the Biotechnology industry and the overall market, CORMEDIX INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • CRMD has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 3.10, which clearly demonstrates the ability to cover short-term cash needs.

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