Vivus (VVUS) Strong On High Relative Volume Today

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

  • VVUS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $2.5 million.
  • VVUS has traded 164,428 shares today.
  • VVUS is trading at 2.36 times the normal volume for the stock at this time of day.
  • VVUS is trading at a new high 4.27% 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 VVUS:

VIVUS, Inc., a biopharmaceutical company, develops and commercializes therapies to address unmet medical needs in the United States and the European Union. Currently there is 1 analyst that rates Vivus a buy, 1 analyst rates it a sell, and 3 rate it a hold.

The average volume for Vivus has been 1.1 million shares per day over the past 30 days. Vivus has a market cap of $165.5 million and is part of the health care sector and drugs industry. The stock has a beta of 0.82 and a short float of 21.9% with 11.65 days to cover. Shares are up 61.8% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Vivus as a sell. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:
  • VVUS'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 43.09%, 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.
  • VVUS, with its decline in revenue, underperformed when compared the industry average of 2.5%. Since the same quarter one year prior, revenues fell by 29.4%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • VIVUS 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, VIVUS INC reported poor results of -$0.90 versus -$0.80 in the prior year. This year, the market expects an improvement in earnings (-$0.48 versus -$0.90).
  • The gross profit margin for VIVUS INC is currently very high, coming in at 84.89%. It has increased significantly from the same period last year. Regardless of the strong results of the gross profit margin, the net profit margin of -79.40% is in-line with the industry average.
  • Net operating cash flow has increased to -$5.25 million or 14.52% when compared to the same quarter last year. In addition, VIVUS INC has also modestly surpassed the industry average cash flow growth rate of 7.24%.

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