1-Star Stocks Poised to Plunge: Cadence Pharmaceuticals?
Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, biotechnology company Cadence Pharmaceuticals (NAS: CADX) has received the dreaded one-star ranking.
With that in mind, let's take a closer look at Cadence's business and see what CAPS investors are saying about the stock right now.
|Headquarters (Founded)||San Diego (2004)|
|Market Cap||$267.2 million|
|Trailing-12-Month Revenue||$10.8 million|
|Management||Co-Founder/CEO Theodore Schroeder|
CFO William LaRue
|Return on Capital (Average, Past 3 Years)||(44.9%)|
|Cash/Debt||$67.6 million / $27.2 million|
Sources: S&P Capital IQ and Motley Fool CAPS.
On CAPS, 33% of the 102 members who have rated Cadence believe the stock will underperform the S&P 500 going forward.
I expect Cadence will display a pattern of weakly increasing revenues that never match the increasing cost of sales and SGA expenses. The share price has remained relatively stable since the last PR, but I expect the stock will gap down again when the next quarterly earnings statement comes out in early March.
What do you think about Cadence, or any other stock for that matter? If you want to retire rich, you need to protect your portfolio from any undue risk. Staying away from dangerous stocks is crucial to securing your financial future, and on Motley Fool CAPS, thousands of investors are working every day to flag them. CAPS is 100% free, so get started!
Want to see how well (or not so well) the stocks in this series are performing? Follow the newTrackPoisedToCAPS account.
At the time this article was published Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Try any of our Foolish newsletter services free for 30 days.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.
Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.