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

  • PTX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $6.2 million.
  • PTX has traded 486,597 shares today.
  • PTX is trading at 4.37 times the normal volume for the stock at this time of day.
  • PTX is trading at a new low 5.00% 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 PTX:

Pernix Therapeutics Holdings, Inc., a specialty pharmaceutical company, develops, manufactures, markets, and sells branded and generic pharmaceutical products. Currently there are 4 analysts that rate Pernix Therapeutics Holdings a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Pernix Therapeutics Holdings has been 1.3 million shares per day over the past 30 days. Pernix has a market cap of $252.1 million and is part of the health care sector and drugs industry. The stock has a beta of 3.10 and a short float of 21.1% with 6.37 days to cover. Shares are down 38.3% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Pernix Therapeutics Holdings as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, generally high debt management risk, disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself.

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 Pharmaceuticals industry. The net income has significantly decreased by 148.1% when compared to the same quarter one year ago, falling from -$9.54 million to -$23.67 million.
  • The debt-to-equity ratio is very high at 4.78 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with the unfavorable debt-to-equity ratio, PTX maintains a poor quick ratio of 0.71, which illustrates the inability to avoid short-term cash problems.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Pharmaceuticals industry and the overall market, PERNIX THERAPEUTICS HOLDINGS'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 -$19.04 million or 211.27% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 27.67%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 138.46% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.

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Today's Weak On High Volume Stock: Pernix Therapeutics Holdings (PTX)

Today's Weak On High Volume Stock: Pernix Therapeutics Holdings (PTX)

Pernix Therapeutics Holdings (PTX) Highlighted As Weak On High Volume

Pernix Therapeutics Holdings (PTX) Highlighted As Weak On High Volume