Pacific Biosciences of California, Inc. (PACB) Stock: Here’s Why It’s Headed For The Bottom

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Pacific Biosciences of California, Inc. (PACB) is making a move down in the market today. The company, one that is focused in the biotechnology industry, is presently priced at $5.49 after heading down -5.34% so far today. In terms of biotech stocks, there are several factors that have the potential to generate declines in the market. One of the most common is news. Here are the most recent trending headlines surrounding PACB:

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Aug-09-19 08:54AM Pacific Biosciences (PACB) Beats on Q2 Earnings & Revenues
Aug-06-19 06:35PM Pacific Biosciences of California (PACB) Reports Q2 Loss, Tops Revenue Estimates
Jul-25-19 10:33AM Analysts Estimate Pacific Biosciences of California (PACB) to Report a Decline in Earnings: What to Look Out for
Jul-22-19 10:06AM What Happens If Pacific Biosciences Isn’t Acquired By Illumina?
Jul-19-19 04:34PM Why J.C. Penney, QEP Resources, and Pacific Biosciences Slumped Today

However, any time investors are making a decision to invest, prospective investors should focus on far more than news, this is especially the case in the highly speculative biotech space. Here’s what’s happening in regard to Pacific Biosciences of California, Inc..

How PACB Has Been Trending

Although a decline in a single session, like the fall that we’re seeing from Pacific Biosciences of California, Inc. may make some investors tremble, a single session decline by itself should not be the basis of a decision to, or not to, buy a company’s stock. It’s always smart to dig into trends just a single session. In the case of PACB, below are the trends that investors have experienced:

  • Weekly – Over the past five trading sessions, PACB has produced a change in value in the amount of 0.00%.
  • Monthly – The monthly returns from Pacific Biosciences of California, Inc. has been -7.89%.
  • Quarterly – In the last 3 months, the stock has produced a return that comes to -25.71%
  • Bi-Annually – In the last 6 months, investors have seen a performance of -22.46% from the company.
  • This Year So Far – Since the close of last year PACB has produced a return on investment of -25.81%.
  • Annually – Finally, in the last full year, we have seen performance that works out to 24.77% from PACB. Over this period of time, the stock has sold at a high of -29.97% and a low of 40.77%.

Key Ratios

Looking at various key ratios associated with a stock can give prospective investors a look of how dangerous and/or rewarding a pick may be. Below are a few of the important ratios to look at when digging into PACB.

Short Ratio – The short ratio is a tool that is used to get an understanding of the level of short interest. The higher this ratio, the more investors believe that the value of the stock is headed for declines. In general, biotech stocks can come with a higher short ratio. However, we also see quite a few short squeezes in the sector. Nonetheless, in relation to Pacific Biosciences of California, Inc., the stock’s short ratio amounts to 12.26.

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 as they mature using quick assets or current assets. Because many biotech companies are reliant on the continuation of support from investors, the current and quick ratios can seem upsetting. Nonetheless, quite a few gems in the biotechnology space do have good quick and current ratios. As far as PACB, the quick and current ratios work out to 1.60 and 2.00 respectively.  

Book To Share Value – The book to share value compares the the price of shares to the book value of assets owned by the company. In this particular case, the book to share value ratio equates to 0.50.

Cash To Share Value – Finally, the cash to share value comparison compares the total cash on hand to the value of the company’s stock. Several clinical stage biotech companies have a hard time keeping cash on hand. So, if you’re interested in a stock in the biotech industry, this is an important ratio to think about. In this case, the cash to share value is 0.43.

What Analysts Say About Pacific Biosciences of California, Inc.

While it’s never a good idea to avoid doing your due diligence and blindly following the thoughts of analysts, it is a smart idea to consider their opinions when validating your own when it comes to making investment decisions in the biotech space. Here are the most recent moves that we have seen from analysts as it relates to PACB.

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Apr-02-19 Downgrade Stephens Overweight → Equal-Weight $4.50 → $8
Oct-19-18 Initiated Cowen Outperform
Nov-03-17 Downgrade First Analysis Sec Overweight → Equal-Weight $4
Sep-28-17 Downgrade CL King Buy → Neutral
Nov-03-16 Reiterated Cantor Fitzgerald Buy $18 → $15

Big Money And Pacific Biosciences of California, Inc.

An interesting fact I’ve come to understand so far in my short period on Earth has been that smart investors tend to follow the moves made by big money. In general, investors that are trying to keep their investments relatively safe will follow moves made by institutional investors as well as insiders of the company. With that said, is big money flowing when it comes to PACB? Here’s what’s happening:

Institutions own 78.50% of the company. Institutional interest has moved by 1.78% over the past three months. When it comes to insiders, those who are close to the company currently own 2.20% percent of PACB shares. Institutions have seen ownership changes of an accumulative -1.14% over the last three months.

What You Need To Know About Share Counts

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 155.39M shares of Pacific Biosciences of California, 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, PACB has a float of 146.72M.

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 PACB, the short percent of the float is 15.78%.

Earnings

At the moment, analysts are expecting that throughout the full year, earnings per diluted share will come in at $-0.43. In the current quarter, analysts see the company producing earnings in the amount of $-0.13. Over the last 5 years, PACB has generated revenue in the amount of $22.80% with earnings coming in at 9.70%. On a quarter over quarter basis, earnings have seen movement of 5.80% and revenue has seen movement of 13.90%.

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