2-Star Stocks Poised to Plunge: Avanir Pharmaceuticals?
Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, drug developer Avanir Pharmaceuticals (NAS: AVNR) has received a distressing two-star ranking.
With that in mind, let's take a closer look at Avanir's business and see what CAPS investors are saying about the stock right now.
Avanirfacts
Headquarters (founded) | Aliso Viejo, Calif. (1988) |
Market Cap | $537.3 million |
Industry | Pharmaceuticals |
Trailing-12-Month Revenue | $24.5 million |
Management | CEO Keith Katkin |
Return on Equity (average, past 3 years) | (106.8%) |
Cash/Debt | $66.7 million / $0 |
Competitors | Bristol-Myers Squibb |
Sources: S&P Capital IQ and Motley Fool CAPS.
On CAPS, 24% of the 256 members who have rated Avanir believe the stock will underperform the S&P 500 going forward.
Just last week, one of those bears, All-Star BlacknGold, touched on the stock's seemingly unsustainable price run:
This came up in a screen for stocks with the highest gains in the last 4 weeks. With a fair [book value per share] of $0.44 this company is greatly overvalued. Cash is shrinking every quarter along with shareholders' equity, which stands at only $60 million as of 1Q12. Should be an easy red-thumb target.
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At the time thisarticle 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.
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