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.
|Headquarters (founded)||Aliso Viejo, Calif. (1988)|
|Market Cap||$537.3 million|
|Trailing-12-Month Revenue||$24.5 million|
|Management||CEO Keith Katkin|
Principal Financial Officer Christine Ocampo
|Return on Equity (average, past 3 years)||(106.8%)|
|Cash/Debt||$66.7 million / $0|
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.
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.
If you want market-topping returns, you need to protect your portfolio from any undue risk. We've compiled a special free report for investors called "Discover the Next Rule-Breaking Multibagger," which uncovers another small-cap growth play with big potential. The report is 100% free, but it won't be around forever, so click here to access it now.
Want to see how well (or not so well) the stocks in this series are performing? Follow theTrackPoisedToCAPS 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.