Intrexon (XON) Is Today's Strong On High 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 Intrexon ( XON) as a strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Intrexon as such a stock due to the following factors:

  • XON has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $36.9 million.
  • XON has traded 360,540 shares today.
  • XON is trading at 3.57 times the normal volume for the stock at this time of day.
  • XON is trading at a new high 4.05% above yesterday's close.

'Strong on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as M&A events, material stock news, analyst upgrades, insider buying, buying from 'superinvestors,' or that hedge funds and momentum traders are piling into 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. 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 XON:

Intrexon Corporation, a biotechnology company, operates in the synthetic biology field in the United States. The company, through a suite of proprietary and complementary technologies, designs, builds, and regulates gene programs, which are DNA sequences that consist of key genetic components. Currently there are 3 analysts that rate Intrexon a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Intrexon has been 1.2 million shares per day over the past 30 days. Intrexon has a market cap of $4.7 billion and is part of the health care sector and drugs industry. Shares are up 65.1% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Intrexon as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity and weak operating cash flow.

Highlights from the ratings report include:
  • XON's very impressive revenue growth greatly exceeded the industry average of 21.6%. Since the same quarter one year prior, revenues leaped by 331.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • XON's debt-to-equity ratio is very low at 0.02 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 4.28, which clearly demonstrates the ability to cover short-term cash needs.
  • INTREXON CORP 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, INTREXON CORP reported poor results of -$0.84 versus -$0.03 in the prior year. This year, the market expects an improvement in earnings (-$0.09 versus -$0.84).
  • 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, INTREXON CORP'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 -$13.04 million or 237.57% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

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