Why Avanir is Poised to Underperform

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, drug developer Avanir Pharmaceuticals (NASDAQ: AVNR  ) has received a distressing two-star ranking.

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

Avanir facts

   

Headquarters (founded)

Aliso Viejo, Calif. (1988)

Market Cap

$428.3 million

Industry

Pharmaceuticals

Trailing-12-Month Revenue

$41.3 million

Management

CEO Keith Katkin (since 2007)

CFO Christine Ocampo (since 2008)

Return on Capital (average, past 3 years)

(66.7%)

Cash/Debt

$69.8 million / $28.9 million

Competitors

Bristol-Myers Squibb (NYSE: BMY  )

Eli Lilly (NYSE: LLY  )

GlaxoSmithKline (NYSE: GSK  )

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 26% of the 250 members who have rated Avanir believe the stock will underperform the S&P 500 going forward.

Just yesterday, one of those Fools, All-Star zzlangerhans, succinctly summed up the Avanir bear case for our community:

Nuedexta revenues have been increasing steadily, but not enough to justify a rebound from [$2.16 to $3.16] and a market cap of [$432M] despite an ongoing double digit quarterly burn and only [$70M] in the bank as of the end of Q3. I suspect traders are looking for positive news on Nuedexta from the [Committee for Medicinal Products for Human Use], but European approval is a notorious false start for companies with products that are already approved in the US. Other pipeline compounds remain in early clinical development.

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Read/Post Comments (6) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On January 17, 2013, at 8:07 PM, Hosana33 wrote:

    Oh you again,,what do you make $100 per article,,what do you know about AVNR ?...not much i see,i guess a bear raid is coming just like after all your article's and trust me your not smart enough or powerful enough.So your cronnies will raid the stock again and you will get 2 more followers..MF is corrupt terrorist outfit !...see ya next time wannabe

  • Report this Comment On January 17, 2013, at 10:59 PM, seantim wrote:

    You used another person's post to try to make a point? Why don't you illuminate us as to what fundamentals drove the stock down from $3.20 on 10/22/12 to $2.16 on 11/15/12. It's just working it's way back up and that has the shorts like you upset. Get used to it over the long haul.

  • Report this Comment On January 18, 2013, at 7:40 AM, Hosana33 wrote:

    He had to write 30 articles at 20 bucks a clip to make rent,so he did a lot of copy and pasting..just checkout his head shot it says it all !

  • Report this Comment On January 18, 2013, at 2:20 PM, seantim wrote:

    Brian D,

    We're still waiting for the information as to what fundamentals drove the stock down from $3.20 on 10/22/12 to the $2.16 on 11/15/12 that you specifically reference. Since that brief period/price was the major focus of your "article" (posted from someone else), please get a bit more granular in your astute and obviously well informed research. Please share that information with us, but if you have nothing concrete to add, pleast stop the hit pieces. Thanks.

  • Report this Comment On January 25, 2013, at 4:10 PM, Hosana33 wrote:

    Good call you SAND-N*GGA,,,keep shorting AVNR

  • Report this Comment On January 28, 2013, at 2:44 PM, Hosana33 wrote:

    checkout the scrips this week,,how about a follow up article..moron!

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10/23/2014 3:59 PM
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