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

  • AMDA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $6.5 million.
  • AMDA has traded 3.7 million shares today.
  • AMDA is trading at 3.35 times the normal volume for the stock at this time of day.
  • AMDA is trading at a new high 11.74% 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 AMDA:

Amedica Corporation, a commercial-stage biomaterial company, develops, manufactures, and sells a range of medical devices based on its silicon nitride technology platform in the United States, Europe, and South America. Currently there is 1 analyst that rates Amedica Corporation a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Amedica Corporation has been 3.7 million shares per day over the past 30 days. Amedica has a market cap of $38.8 million and is part of the health care sector and health services industry. Shares are down 12.5% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Amedica Corporation as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, generally high debt management risk, 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 compared to the Health Care Equipment & Supplies industry average, but is greater than that of the S&P 500. The net income has decreased by 14.2% when compared to the same quarter one year ago, dropping from -$4.71 million to -$5.38 million.
  • The debt-to-equity ratio is very high at 7.00 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, AMDA maintains a poor quick ratio of 0.74, which illustrates the inability to avoid short-term cash problems.
  • Net operating cash flow has decreased to -$2.97 million or 48.47% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • AMDA's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 90.64%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last 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.
  • The revenue fell significantly faster than the industry average of 21.8%. Since the same quarter one year prior, revenues fell by 17.9%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.

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