Summit Therapeutics plc (SMMT) Stock: Why It’s Headed Up

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Summit Therapeutics plc (SMMT) is gaining in the market today. The company, one that is focused in the biotechnology space, is currently trading at $2.03 after gaining 7.41% so far today. When it comes to biotech companies, there are several factors that have the ability to generate price movement in the market. News tends to be one of the biggest reasons for the movement. Here are the most recent headlines surrounding SMMT:

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Apr-15-19 02:00AM Summit Presents In Vivo Proof of Concept Data for New Mechanism Antibiotics Targeting Enterobacteriaceae in Oral Session at ECCMID 2019
Apr-14-19 07:42AM Summit Presents In Vivo Proof of Concept Data for New Mechanism Antibiotics Targeting Enterobacteriaceae in Oral Session at ECCMID 2019
Apr-12-19 10:08AM Antimicrobials Working Group Highlights Member Company Participation at the 29th European Congress of Clinical Microbiology and Infectious Diseases (ECCMID)
Apr-04-19 01:38PM Biotech, in motion: Demand for life science execs fuels game of musical chairs
Apr-03-19 07:00AM Summits Pipeline Expands with Series of New Mechanism Antibiotics Targeting Enterobacteriaceae

However, when making a decision to invest, prospective investors should look into much more than just news, especially in the generally speculative biotech sector. Here’s what’s happening in regard to Summit Therapeutics plc.

How SMMT Has Been Trending

Although a single session gain, like the gain that we’re seeing from Summit Therapeutics plc might lead to excitement in some investors, that by itself shouldn’t be the reason for a decision to, or not to, invest in a stock. It’s generally a good idea to look at trends experienced by the stock for a period longer than a single session. In the case of SMMT, below are the returns that we have seen:

  • Past 7 Days – In the past week, SMMT has generated a price change amounting to 2.01%.
  • Past 30 Days – The performance from Summit Therapeutics plc in the past 30 days works out to 0.06%.
  • Past Quarter – In the past quarter, the company has generated a return on investment of 32.68%
  • Bi-Annually – Over the last six months, we have seen a change of 2.78% from the company.
  • This Year So Far – Since the close of last year SMMT has produced a ROI of 76.52%.
  • Full Year – Lastly, in the last full year, investors have seen performance that works out to -85.23% from SMMT. In this period, the stock has sold at a high of -85.79% and a low price of 84.55%.

Ratios Worth Paying Attention To

Digging into a few key ratios having to do with a stock can give prospective traders a look of how risky and/or potentially profitable a stock pick may be. Below are some of the important ratios to think about when looking at SMMT.

Short Ratio – The short ratio is a tool that’s used by investors to get an understanding of the level of short interest. As the ratio heads up, it shows that more investors believe that the value of the stock is going to tumble. Throughout the sector, biotechnology stocks tend to have a higher short ratio. However, we also tend to see a lot of short squeezes in the space. Nonetheless, in relation to Summit Therapeutics plc, the stock’s short ratio is 7.90.

Quick & Current Ratios – The quick and current ratios are tools that are used to get an idea of the company’s liquidity. Essentially, they measure If a company is able to cover its debts when they come due based on quick assets or current assets. In the biotechnology industry, many companies rely heavily on continued support from investors, the quick and current ratios can seem upsetting. However, quite a few better companies in the biotech space do have great quick and current ratios. When it comes to SMMT, the quick and current ratios work out to 0 and 0 respectively.  

Book To Share Value – The book to share value compares the the price of shares to the current book value of assets owned by the company. In this particular case, the book to share value ratio is 2.26.

Cash To Share Value – The cash to share value ratio compares the total cash on hand to the price of shares. Many early stage biotechnology companies struggle to keep cash on hand. So, if you’re considering an investment in a stock in the biotechnology sector, this is a very important ratio to think about. As it relates to SMMT, the cash to share value works out to 0.

Analyst Opinions With Regard To Summit Therapeutics plc

While it’s rarely a good idea to unknowingly follow the thoughts of analysts, it is a good idea to use their analysis in order to validate your own opinions when it comes to making an investment decision in the biotech sector. Here are the most recent moves that we’ve seen from analysts with regard to SMMT.

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Jun-28-18 Downgrade Janney Buy → Neutral
May-02-18 Initiated Janney Buy
Apr-12-18 Reiterated Needham Buy $30 → $27
Feb-13-18 Initiated BTIG Research Buy $33
Jan-04-18 Initiated SunTrust Buy $24

Smart Money Follows Big Money

Humans that are into investing seem to be infatuated with the term “Smart money follows big money.” It makes sense. Big money became big money by making smart decisions in the market. So, by following the moves of big money institutions and insiders, we can get a glimpse of what market pros think about a stock. When it comes to big money interest in SMMT, here’s what we’re seeing:

  • Institutions – Currently, institutional investors hold 9.00% of the company. However, it is important to consider that the ownership held by institutions has changed in the amount of 0 throughout the last quarter.
  • Insider Moves – as it relates to insiders, those close to the company currently own 48.71% of the company. Insider ownership of the company has changed by 0.00% in the last 3 months.

How Many Shares Of SMMT Are Available?

Investors and traders seem to have an interest in the total numbers of shares both available and outstanding. In regard to Summit Therapeutics plc, currently there are 82.13M with a float of 10.22M. These data mean that of the total of 82.13M shares of SMMT that are out there today, 10.22M are able to trade hands in the public realm.

Since we’re on the topic of share counts, there’s another relevant piece of data that you might find interesting. That would be the short percentage of the float. Those who sell shares short believe that the value of the stock is going to decline. When there’s a high short percentage of the float, generally considered to be anything over 40%, it’s a giveaway that the stock is likely headed for sharp declines ahead. Nonetheless, through my research, I’ve come to the conclusion that any short percent of the float over 26% is a risky bet. When it comes to SMMT, the short percent of the float is 5.05%.

Financial Results And Expectations

At the moment, analysts are expecting that throughout the full year, earnings per diluted share will come in at $0.14. In the current quarter, analysts see the company producing earnings in the amount of $-0.19. Over the last 5 years, SMMT has generated revenue in the amount of $0 with earnings coming in at 0. On a quarter over quarter basis, earnings have seen movement of 0 and revenue has seen movement of 52.20%.

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