Adamas Pharmaceuticals (ADMS) Flagged As Strong On High Volume

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

  • ADMS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $6.6 million.
  • ADMS has traded 55,847 shares today.
  • ADMS is trading at 5.03 times the normal volume for the stock at this time of day.
  • ADMS is trading at a new high 7.25% 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 ADMS:

Adamas Pharmaceuticals, Inc., a specialty pharmaceutical company, focuses on the development and commercialization of therapeutics targeting chronic disorders of the central nervous systems in the United States. ADMS has a PE ratio of 34. Currently there are 2 analysts that rate Adamas Pharmaceuticals a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Adamas Pharmaceuticals has been 104,200 shares per day over the past 30 days. Adamas has a market cap of $346.7 million and is part of the health care sector and drugs industry. Shares are up 12% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Adamas Pharmaceuticals 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 notable return on equity. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, unimpressive growth in net income and weak operating cash flow.

Highlights from the ratings report include:
  • ADMS's revenue growth has slightly outpaced the industry average of 21.9%. Since the same quarter one year prior, revenues rose by 28.4%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • ADMS 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 14.19, which clearly demonstrates the ability to cover short-term cash needs.
  • Compared to other companies in the Biotechnology industry and the overall market, ADAMAS PHARMACEUTICALS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • 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 91.3% when compared to the same quarter one year ago, falling from -$6.38 million to -$12.20 million.
  • Net operating cash flow has significantly decreased to -$14.07 million or 107.29% 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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