Why Hyperion Is Poised to Pull Back

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, biotechnology company Hyperion Therapeutics (UNKNOWN: HPTX.DL  ) has received the dreaded one-star ranking.

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

Hyperion facts

Headquarters (founded)

South San Francisco, Calif. (2006)

Market Cap

$246.7 million



Trailing-12-Month EBITDA

($27.4 million)


CEO Donald Santel (since 2008)
CFO Jeffrey Farrow (since 2010)


$56.5 million / $12.0 million


Alexion Pharmaceuticals
Cumberland Pharmaceuticals
Salix Pharmaceuticals

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

On CAPS, 69% of the 13 members who have rated Hyperion believe the stock will underperform the S&P 500 going forward.

Just yesterday, one of those Fools, All-Star zzlangerhans, tapped the stock's recent surge as particularly unsustainable:

Hyperion is a strange case. Not because the FDA informed them that they wouldn't have a decision on Ravicti by the January 23 PDUFA date -- that's sadly become a common occurrence over the last two years. The odd part is that Hyperion chose to telegraph that Hyperion had been approved by elaborating that the reason for the delay was to iron out labeling and post-marketing requirements. The market therefore reacted as though approval had been announced, sending the stock up 25% since the announcement.

I see Ravicti approval as a sell-on-the-news event. There's already a standard treatment of urea cycle disorders called Buphenyl. Ravicti is an upgrade with less frequent dosing and better tolerability, but Buphenyl revenues are only about [$15M] per year. How much will Hyperion be able to chisel out of insurers for an upgrade? ...

The only question now is will the news be what everyone apparently thinks it will be, and has approval been completely priced in. If so, I don't think the current iteration of biopharma traders will stick around to see if Ravicti is really worth a [$250M] market cap.

If you want market-topping returns, you need to put together the best portfolio you can. Luckily, we've found another stock we are incredibly excited about -- excited enough to dub it "The Motley Fool's Top Stock for 2013." We have compiled a special free report for investors to uncover this stock today. The report is 100% free, but it won't be here forever, so click here to access it now.

Want to see how well (or not so well) the stocks in this series are performing? Follow the TrackPoisedTo CAPS account.

Read/Post Comments (2) | Recommend This Article (0)

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.

Add your comment.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2204661, ~/Articles/ArticleHandler.aspx, 9/26/2016 10:03:08 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated Moments ago Sponsored by:
DOW 18,121.78 -139.67 -0.76%
S&P 500 2,151.18 -13.51 -0.62%
NASD 5,265.13 -40.62 -0.77%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

12/31/1969 7:00 PM
HPTX.DL $0.00 Down +0.00 +0.00%
Hyperion Therapeut… CAPS Rating: **
ALXN $126.48 Down -0.74 -0.58%
Alexion Pharmaceut… CAPS Rating: ****
CPIX $4.93 Down -0.05 -1.00%
Cumberland Pharmac… CAPS Rating: ***
SLXP.DL $0.00 Down +0.00 +0.00%
Salix Pharmaceutic… CAPS Rating: ***