4 High-Growth Biotech Stocks With Negative Receivable Trends

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 |  Includes: ANIK, CELG, EBS, REGN
by: Kapitall

Do you follow company sales trends? Most companies rely on sales as their primary source of profits, so a sales analysis should be high on the list. To illustrate, we ran a screen.

We began by screening the biotech industry for stocks with high growth prospects, with 5-year projected EPS growth above 15%.

We then screened for those stocks with weak sales trends, comparing growth in revenue to growth in accounts receivable. Since accounts receivable is the portion of revenue not yet received, and there is no guarantee the money will ever be received, the smaller the portion of revenue made up of receivables the healthier the company's revenue.

We screened for stocks seeing slower growth in revenue than accounts receivable year-over-year, as well as accounts receivable comprising a larger portion of current assets over the same time period.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.

We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.

Do you think these companies are in hot water? Use this list as a starting point for your own analysis.

List sorted by change in revenue over the last year.

1. Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN): Develops, and commercializes pharmaceutical products for the treatment of serious medical conditions in the United States. Market cap at $12.47B, most recent closing price at $129.45. 5-year projected EPS growth at 25.00%. Revenue grew by 106.59% during the most recent quarter ($231.79M vs. $112.2M y/y). Accounts receivable grew by 170.36% during the same time period ($238.35M vs. $88.16M y/y). Receivables, as a percentage of current assets, increased from 27.08% to 34.2% during the most recent quarter (comparing 3 months ending 2012-03-31 to 3 months ending 2011-03-31).

2. Anika Therapeutics Inc. (NASDAQ:ANIK): Develops, manufactures, and commercializes therapeutic products for tissue protection, healing, and repair. Market cap at $187.41M, most recent closing price at $13.37. 5-year projected EPS growth at 30.00%. Revenue grew by 22.32% during the most recent quarter ($14.36M vs. $11.74M y/y). Accounts receivable grew by 36.11% during the same time period ($17M vs. $12.49M y/y). Receivables, as a percentage of current assets, increased from 22.7% to 26.58% during the most recent quarter (comparing 3 months ending 2012-03-31 to 3 months ending 2011-03-31).

3. Celgene Corporation (NASDAQ:CELG): Develops, and commercializes various therapies to treat cancer and immune-inflammatory related diseases. Market cap at $31.15B, most recent closing price at $70.17. 5-year projected EPS growth at 24.34%. Revenue grew by 13.15% during the most recent quarter ($1,273.29M vs. $1,125.28M y/y). Accounts receivable grew by 28.78% during the same time period ($1,035.47M vs. $804.03M y/y). Receivables, as a percentage of current assets, increased from 19.17% to 25.66% during the most recent quarter (comparing 3 months ending 2012-03-31 to 3 months ending 2011-03-31).

4. Emergent BioSolutions, Inc. (NYSE:EBS): Develops, manufactures, and commercializes immunobiotics such as vaccines and immune globulins that assist the body's immune system. Market cap at $530.11M, most recent closing price at $14.53. 5-year projected EPS growth at 32.00%. Revenue grew by 4.55% during the most recent quarter ($107.95M vs. $103.25M y/y). Accounts receivable grew by 74.11% during the same time period ($83.66M vs. $48.05M y/y). Receivables, as a percentage of current assets, increased from 19.73% to 32.88% during the most recent quarter (comparing 3 months ending 2011-12-31 to 3 months ending 2010-12-31).

*Accounting data sourced from Google Finance, all other data sourced from Finviz.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.