1-Star Stocks Poised to Plunge: Hemispherx?

Based on the aggregated intelligence of 130,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, development-stage biotech Hemispherx Biopharma (NYSE: HEB  ) has received the dreaded one-star ranking.

With that in mind, let's take a closer look at Hemispherx's business, and see what CAPS investors are saying about the stock right now.

Hemispherx facts

Headquarters (founded)	Philadelphia, Pennsylvania (1990)
Market Cap	$144.7 million
Industry	Biotechnology
TTM Revenue	$86,000
Management	Chairman/CEO Dr. William Carter Chief Financial Officer Charles Bernhardt
Return on Capital (average, last three years)	(44.7%)
1-Month Price Change	278%
Competitors	Schering-Plough (NYSE: SGP  ) Gilead Sciences (Nasdaq: GILD  )
CAPS members bearish on HEB also bearish on	Vonage (NYSE: VG  ) Sulphco
CAPS members bullish on HEB also bullish on	General Electric (NYSE: GE  ) Citigroup (NYSE: C  ) Bank of America (NYSE: BAC  )

Sources: Yahoo! Finance; Capital IQ (a division of Standard & Poor's); and Motley Fool CAPS. TTM = trailing 12 months.

Over on CAPS, 64 of the 103 members who have rated Hemispherx -- or 62% -- believe the stock will underperform the S&P 500 going forward. These bears include All-Stars TSIF and zzlangerhans, who are ranked in the top 1% of our community.

Just yesterday, TSIF brought Hemispherx's swine-flu-fueled price run to our community's attention:

Generally FDA rulings have hard dates and hard data requirements. The spike seems to be that some investors think they will get an early review due to their preclinical studies in pandemic vaccines. The FDA, however, has never been known to rush a drug to market.

In a pitch from one day earlier, zzlangerhans elaborates on the bear case:

I kept following it but thought that it would remain in the sub-1 club until the FDA put their boot down on Ampligen again, shriveling the share price and any prospects of continued financing. But here we are a week short of the Ampligen PDUFA [Prescription Drug User Fee Act] and the stock has quadrupled off their recent stable low of 0.4. A lot of smashed up baby bios [development-stage companies] have been doing this lately and are providing good red thumb fodder....

Dilutive financings of 16M and 18M completed with lightning speed as the share price rose prior to the 5/25 PDUFA. Think these guys have any confidence that they'll get approval? Obviously not or they'd wait until their share price was at 10 after approval to raise cash.

What do you think about Hemispherx Biopharma, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. CAPS is 100% free, so simply click here to get started.