ObsEva SA (OBSV) Stock: Why It’s Falling

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ObsEva SA (OBSV) is trending down in the market in today’s trading session. The stock, one that is focused in the biotechnology sector, is currently priced at $2.76 after a move down of -8.00% so far today. When it comes to biotechnology companies, there are a number of aspects that have the ability to lead to declines in the market. News tends to be one of the biggest reasons for the movement. Here are the recent headlines relating to OBSV:

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Nov-08-19 08:14AM The Daily Biotech Pulse: Therapix Calls Off Merger, Alimera’s Reverse Split, 2 Biotechs To Debut
05:01AM Edited Transcript of OBSV.O earnings conference call or presentation 7-Nov-19 1:00pm GMT
Nov-07-19 07:30AM ObsEva SA (OBSV) Reports Q3 Loss, Misses Revenue Estimates
07:18AM The Daily Biotech Pulse: Obseva Sinks On Adverse Clinical Readout, BioNano Surges On Saphyr Adoption, 2 IPOs
01:10AM ObsEva Announces Third Quarter 2019 Financial Results

However, when making an investing decision, investors should look at far more than news, this is especially the case in the speculative biotech space. Here’s what’s happing when it comes to ObsEva SA.

The Performance That OBSV Investors Have Experienced

Although a move down on a single session, like the fall that we’re seeing from ObsEva SA may cause fear in some investors, a single session decline by itself should not be the reason for a decision to, or not to, buy a company’s stock. It’s always smart to look at trends experienced by the stock further out than a single session. As it relates to OBSV, below are the movements that investors have experienced:

  • Past 5 Trading Sessions – Over the past 5 trading sessions, OBSV has produced a change in price in the amount of -64.75%.
  • Monthly – The return from ObsEva SA in the past month works out to -63.97%.
  • Quarterly – Over the last 3 months, the company has produced a return of -69.33%
  • Bi-Annually – Throughout the last six months, we have seen a change that equates to -79.23% from the stock.
  • Year To Date – Since the the last trading session of last year OBSV has produced a ROI of -78.20%.
  • Full Year – Finally, throughout the past full year, we’ve seen a change of -82.02% out of OBSV. In this period of time, the stock has sold at a high price of -83.26% and a low price of 0.36%.

Ratios To Watch

Digging into various ratios associated with a stock can give investors a view of just how risky and/or potentially profitable a an investment option might be. Here are some of the most important ratios to consider when looking at OBSV.

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 going to tumble. Across the sector, biotech stocks can carry a higher short ratio. On the other hand, we also see a lot of short squeezes in the space. Nonetheless, in relation to ObsEva SA, it’s short ratio clocks in at 3.14.

Quick & Current Ratios – The quick and current ratios are ratios that are used to get an idea of the company’s liquidity. Basically, they measure If a company is able to pay its debts when they come due with only current assets or quick assets. Because many biotech many companies are heavily reliant on the continuation of support from investors, these ratios can seem upsetting. However, some good picks in the biotech space come with great current and quick ratios. As it relates to OBSV, the quick and current ratios add up to 3.70 and 3.70 respectively.  

Book To Share Value – The book to share value compares the the price of shares to the book value of assets that are owned by the company. In this case, that ratio comes in at 1.60.

Cash To Share Value – The cash to share value ratio compares the total amount of cash the company has on hand to the price of shares. Several early stage biotech companies have a hard time keeping cash on hand. So, when investing in the biotechnology industry, this is a very important ratio to consider. In this case, the cash to share value comes to 2.22.

What Analysts Say About ObsEva SA

While it’s not a smart idea to avoid doing your due diligence and blindly following the opinions of analysts, it is a smart idea to use their analysis when validating your own due diligence before making investment decisions in the biotechnology industry. Below are the most recent moves that we’ve seen from analysts with regard to OBSV.

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Nov-08-19 Downgrade Credit Suisse Outperform → Neutral $16 → $4
Sep-13-18 Initiated JP Morgan Overweight $29
Aug-15-18 Resumed Leerink Partners Outperform $25
Aug-07-18 Initiated Wedbush Outperform $34
Jul-19-18 Initiated Credit Suisse Outperform $24

Moves From Big Money Players

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 OBSV, here’s what we’re seeing:

  • Institutions – As it stands now, institutional investors hold 74.30% of OBSV. On the other hand, it is important to note that the ownership held by institutions has moved in the amount of 0.47% in the last 3 months.
  • Insiders – as it relates to insiders, insiders of the company currently hold 14.47% of the company. Their ownership of the company has changed by 0.00% throughout the last quarter.

What You Need To Know About Share Counts

Traders and investors tend to like to know the amounts of shares both available and outstanding. As far as ObsEva SA, there are currently 40.97M and there is a float of 40.43M. These numbers mean that out of the total of 40.97M shares of OBSV currently in existence today, 40.43M are able to be traded on the market.

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 OBSV, the short percent of the float is 0.74%.

Financial Results And Expectations

At the moment, analysts are expecting that throughout the full year, earnings per diluted share will come in at $-2.60. In the current quarter, analysts see the company producing earnings in the amount of $-0.67. Over the last 5 years, OBSV 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 -46.70% and revenue has seen movement of -66.70%.

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