Verastem, Inc. (VSTM) Stock: Here’s Why It’s Climbing

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Verastem, Inc. (VSTM) is headed up in the market today. The company, one that is focused in the biotechnology sector, is presently priced at $1.40 after a move up of 10.24% so far in today’s session. When it comes to biotechnology companies, there are several factors that have the potential to lead to movement in the market. One of the most common is news. Here are the most recent trending headlines relating to VSTM:

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May-30-19 07:00AM Verastem Oncology to Present at the Jefferies 2019 Global Healthcare Conference
May-24-19 02:42PM Did You Manage To Avoid Verastem’s (NASDAQ:VSTM) Devastating 85% Share Price Drop?
02:35PM Edited Transcript of VSTM earnings conference call or presentation 9-May-19 8:30pm GMT
May-16-19 07:00AM Verastem Oncology to Present at the 20th Annual B. Riley FBR Institutional Investor Conference
May-15-19 05:16PM Verastem Oncology to Present New COPIKTRA (Duvelisib) Dose Modification Data from Patients Treated in the Phase 3 DUO Study

However, when making a decision with regard to investing, prospective investors should focus on much more than news, especially in the speculative biotech space. Here’s what’s going on with Verastem, Inc..

Recent Movement Out of VSTM

Although a single session gain, like the gain that we’re seeing from Verastem, Inc. may make some investors jump for joy, that alone should not be the reason for a decision to, or not to, invest in a company. It’s generally important to dig into trends experienced by the stock further out than a single session. In the case of VSTM, below are the movements that investors have experienced:

  • Past Seven Days – Throughout the past seven days, VSTM has generated a price change amounting to 12.00%.
  • Monthly – The ROI from Verastem, Inc. throughout the last 30 days has been -9.09%.
  • Past Quarter – Throughout the last quarter, the company has produced a return on investment that comes to -54.98%
  • Past 6 Months – Over the previous 6 months, we have seen a performance that amounts to -68.11% from the stock.
  • Year To Date – Since the close of last year VSTM has produced a ROI of -58.33%.
  • Full Year – Finally, over the past year, investors have seen a change that works out to -75.27% out of VSTM. In this period, the stock has sold at a high of -86.47% and a low of 20.69%.

Key Ratios

Looking at various key ratios associated with a company generally gives prospective traders an understanding of just how risky and/or potentially profitable a stock pick may be. Below are some of the most important ratios to look at when looking at VSTM.

Short Ratio – The short ratio is a measure of short interest. As the short ratio heads up, it means that more investors believe that the stock is headed for declines. Throughout the sector, biotechnology stocks tend to carry a higher short ratio. However, we also see quite a few short squeezes in the space. Nonetheless, in regard to Verastem, Inc., the stock’s short ratio is 7.85.

Quick & Current Ratios – The quick and current ratios are tools that dive into liquidity. Basically, they measure If a company is able to pay for its debts when they mature with only current assets or quick assets. In the biotech space, many companies rely on the continuation of investor support, these ratios can be upsetting. Nonetheless, several better companies in the biotech space come with good current and quick ratios. As it relates to VSTM, the quick and current ratios total up to 7.60 and 7.60 respectively.  

Book To Share Value – The book to share value compares the the share price to the book value of assets that are owned by the company. In this particular case, the book to share value ratio works out to 1.20.

Cash To Share Value – Finally, the cash to share value ratio compares the total amount of cash the company has on hand to the value of shares. Many clinical stage biotech companies struggle to keep cash on hand. So, if you’re considering an investment in a biotechnology stock, this is an important ratio to consider. In this case, the cash to share value ratio is 2.87.

Analyst Opinions With Regard To Verastem, Inc.

While it’s not a good idea to avoid doing your DD and blindly following the thoughts of analysts, it is a good idea to consider their opinions to validate your own thoughts when it comes to making investment decisions in the biotech space. Here are the recent moves that we have seen from analysts when it comes to VSTM.

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May-10-19 Downgrade Raymond James Outperform → Mkt Perform
Jul-13-18 Initiated BTIG Research Buy $17
May-02-18 Initiated Seaport Global Securities Buy $14
Mar-08-18 Initiated B. Riley FBR, Inc. Buy $15
Sep-07-17 Reiterated H.C. Wainwright Buy $6.50 → $10

Investors Tend To Follow The 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 VSTM, here’s what we’re seeing:

Institutions own 45.70% of the company. Institutional interest has moved by -25.31% over the past three months. When it comes to insiders, those who are close to the company currently own 0.20% percent of VSTM shares. Institutions have seen ownership changes of an accumulative 28.77% over the last three months.

How Many Shares Of VSTM Are Available?

Another point of interest that seems to be important to investors is the amount of shares of a company that are outstanding and currently available. At the moment, there are 73.85M shares of Verastem, Inc. outstanding. Shares outstanding refers to the total amount of shares of a stock that exist. As far as the float goes, or the amount of shares that are actually available on the retail market, VSTM has a float of 67.21M.

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 VSTM, the short percent of the float is 28.80%.

Financial Performance

What have ween seen from VSTM in terms of financial results?Here’s what you need to know:

  • Analyst Expectations – At the moment, Wall Street analysts are expecting that VSTM will create earnings per diluted share of -1.58, with -0.50 being reported in the earnings report for the current quarter. Although this data isn’t associated with earnings, because we’re talking on the topic of Wall St. analysts, the stock is presently graded as a 1.80 when rated on a scale from 1 to 5 on which 1 is the poorest Wall Street analyst rating and 5 is the best.
  • 5-Year Sales – Throughout the last 5 years, Verastem, Inc. has announced a change in sales volume that works out to be 0. Earnings per share in the period have experienced a change of 9.30%.
  • Quarter Over Quarter – In terms of quarter over quarter earnings performance, or Q/Q data as it is generally represented in the world of humans, VSTM has generated a earnings change by -24.60%. VSTM has also seen a change in regard to revenue in the amount of 0.

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