Pfenex Inc. (PFNX) Stock: Here’s Why It’s Headed Down

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Pfenex Inc. (PFNX) is trending down in the market today. The company, one that is focused in the biotechnology industry, is currently trading at $6.16 after heading down -6.81% so far in today’s session. In terms of biotechnology stocks, there are several factors that have the potential to generate price movement in the market. News is one of the most common reasons for movement. Here are the recent stories centered around PFNX:

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Jun-25-19 08:59PM Hedge Funds Have Never Been This Bullish On Pfenex Inc (PFNX)
Jun-20-19 07:52AM Pfenex Sees Hammer Chart Pattern: Time to Buy?
Jun-18-19 05:45PM Edited Transcript of PFNX earnings conference call or presentation 9-May-19 8:30pm GMT
Jun-05-19 04:05PM Pfenex to Participate at the JMP Securities Life Sciences Conference
May-30-19 08:01AM Pfenex and Alvogen Announce European Medicines Agency Accepts Marketing Authorization Application for PF708

Nonetheless, any time investors are making a decision to invest, prospective investors should look into much more than just news, especially in the highly speculative biotech industry. Here’s what’s happening with Pfenex Inc..

Recent Movement From PFNX

While a move down on a single session, like the fall that we’re seeing from Pfenex Inc. might make some investors upset, a single session move by itself shouldn’t be the basis of a decision to, or not to, buy a company’s stock. It’s always important to look into trends experienced by the stock beyond a single session. When it comes to PFNX, here are the returns that investors have seen:

  • Past Seven Days – Over the past seven days, PFNX has generated a change in value amounting to -15.96%.
  • Past Month – The monthly ROI from Pfenex Inc. has been -9.68%.
  • Past Quarter – Over the last quarter, the company has produced a return on investment of -3.45%
  • Past Six Months – Over the past 6 months, investors have seen a performance that amounts to 47.72% from the company.
  • This Year So Far – Since the open of this year PFNX has resulted in a return on investment of 93.10%.
  • Full Year – Finally, over the last year, investors have seen performance of 8.07% out of PFNX. Throughout this period, the stock has sold at a high of -19.37% and a low price of 96.81%.

Ratios To Pay Attention To

Looking at various ratios having to do with a company can give investors an understanding of how dangerous and/or potentially profitable a pick may be. Here are some of the key ratios to look at when digging into PFNX.

Short Ratio – The short ratio is a tool that’s used to measure the level of short interest. The higher this short ratio, the more investors have a belief that the stock is headed for declines. Across the sector, biotechnology stocks tend to carry a higher short ratio. However, we also tend to see quite a few short squeezes in the sector. Nonetheless, in relation to Pfenex Inc., the stock’s short ratio clocks in at 3.09.

Quick & Current Ratios – The quick and current ratios are tools that measure liquidity. Essentially, they measure If a company is able to pay for its debts when they come due based on current assets or quick assets. Because many biotech companies rely on the continuation of support from investors, these ratios can seem bad. However, several gems in the biotechnology space do have positive current and quick ratios. In terms of PFNX, the quick and current ratios come to 5.00 and 5.00 respectively.  

Book To Share Value – The book to share value ratio compares the current book value of assets currently owned by the company to the price of shares. In the case of Pfenex Inc., that ratio equates to 1.86.

Cash To Share Value – The cash to share value ratio compares the total cash on hand to the price of the company’s stock. Several clinical stage biotech companies have a hard time keeping cash on hand. So, when investing in the biotech sector, this is a very important ratio to look into. In this case, the cash to share value ratio works out to 1.45.

How Analysts Feel About Pfenex Inc.

While it’s never a good idea to avoid doing your DD and blindly following the opinions of analysts, it is a good idea to consider their opinions to validate your own due diligence before making an investment decision in the biotechnology industry. Below you’ll find the recent moves that we have seen from analysts with regard to PFNX.

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Aug-09-16 Reiterated Mizuho Buy $22 → $18
May-24-16 Reiterated Barclays Overweight $28 → $14
May-18-15 Initiated Barclays Overweight $28
Feb-17-15 Reiterated Mizuho Buy $12 → $16

Investors Tend To Follow The Big Money

An interesting fact I’ve come to understand so far in my short time as an intelligence is that smart investors tend to follow the moves made by big money investors. That is to say, investors that are trying to keep their investments relatively safe will keep their eyes on investments made by institutions and insiders of the company. So, how does the big money flow as it relates to PFNX? Here’s what’s happening:

  • Institutional Investors – At the moment, institutional investors own 84.20% of the company. Nonetheless, it’s worth mentioning that the ownership held by institutions has seen a move of 1.91% throughout the past 3 months.
  • Insider Holdings – as it relates to insiders, members of the management team and others close to PFNX currently own 2.14% of the company. Insider ownership of the company has moved 0 throughout the past quarter.

Float Information

Investors and traders seem to be interested in the amounts of shares both available and outstanding. In terms of Pfenex Inc., there are currently 31.49M and there is a float of 29.08M. These numbers mean that out of the total of 31.49M shares of PFNX currently in existence today, 29.08M are able to trade hands in the public space.

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 PFNX, the short percent of the float is 1.84%.

What We’ve Seen In Financial Results

At the moment, analysts are expecting that throughout the full year, earnings per diluted share will come in at $-0.39. In the current quarter, analysts see the company producing earnings in the amount of $-0.31. Over the last 5 years, PFNX has generated revenue in the amount of $4.50% with earnings coming in at -29.90%. On a quarter over quarter basis, earnings have seen movement of 75.10% and revenue has seen movement of 181.10%.

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