Lexicon Story

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25% of stocks are less volatile than Lexicon, and 99% of all traded equity instruments are projected to make higher returns than the company over the 60 days investment horizon. As many investors are getting excited about healthcare space, it is fair to break down Lexicon Pharmaceuticals. We are going to inspect if the current expected returns justify Lexicon Pharmaceuticals' volatility.
Published over three weeks ago
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Will Lexicon Pharmaceuticals (NASDAQ:LXRX) current volatility spike continue?
Lexicon Pharmaceuticals currently holds roughly 201.87 M in cash with 97.97 M of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 1.88, which can makes it an attractive takeover target, given it will continue generating positive cash flow.

How important is Lexicon Pharmaceuticals's Liquidity

Lexicon Pharmaceuticals financial leverage refers to using borrowed capital as a funding source to finance Lexicon Pharmaceuticals ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Lexicon Pharmaceuticals financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Lexicon Pharmaceuticals's total debt and its cash.

How Lexicon utilizes its cash?

To perform a cash flow analysis of Lexicon Pharmaceuticals, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Lexicon Pharmaceuticals is receiving and how much cash it distributes out in a given period. The Lexicon Pharmaceuticals cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities. Lexicon Pharmaceuticals Net Cash Flow from Operations is fairly stable at the moment as compared to the past year. Lexicon Pharmaceuticals reported Net Cash Flow from Operations of 113.81 Million in 2019

Purchase by Raymond Debbane of 3400 shares of Lexicon Pharmaceuticals

Legal trades by Lexicon Pharmaceuticals insiders are very common, as founders, directors, or employees of any publicly traded firm often have stock or stock options. These trades are made public in the United States through the filing of Form 4 of the Securities and Exchange Commission. Below entry was recorded recently and is publicly available as an insider trade:
Lexicon Pharmaceuticals insider trading alert for perchase of common stock by Raymond Debbane, the corporate stakeholder, on 17th of June 2020. This event was filed by Lexicon Pharmaceuticals I with SEC on 2019-09-17. Statement of changes in beneficial ownership - SEC Form 4. Raymond Debbane is currently serves as independent chairman of the board of Lexicon Pharmaceuticals [view details]   
Note, although insider trading is legal, in the United States, Canada, Australia, and Germany, for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors, and any beneficial owners of more than 10% of a class of the company's equity securities.

Is Lexicon Pharmaceuticals valued reasonably by the market?

This firm reported the previous year's revenue of 320.34 M. Net Income was 39.27 M with profit before overhead, payroll, taxes, and interest of 226.92 M.

Our take on Lexicon Pharmaceuticals to recuperate

Current value at risk is at -4.49. As of the 29th of October, Lexicon Pharmaceuticals secures the mean deviation of 2.34, and Risk Adjusted Performance of (0.12). In connection with fundamental indicators, the technical analysis model lets you check existing technical drivers of Lexicon Pharmaceuticals, as well as the relationship between them. Strictly speaking, you can use this information to find out if the firm will indeed mirror its model of past prices, or the prices will eventually revert. We were able to break down nineteen technical drivers for Lexicon Pharmaceuticals, which can be compared to its peers in the industry. Please verify Lexicon Pharmaceuticals jensen alpha, semi variance, and the relationship between the standard deviation and value at risk to decide if Lexicon Pharmaceuticals is priced some-what accurately, providing market reflects its recent price of 1.16 per share. Given that Lexicon Pharmaceuticals is a hitting penny stock territory we strongly suggest to closely look at its total risk alpha.

Our Final Take On Lexicon Pharmaceuticals

While other companies in the biotechnology industry are either recovering or due for a correction, Lexicon may not be as strong as the others in terms of longer-term growth potentials. In closing, as of the 29th of October 2020, our present 30 days advice on the company is Strong Sell. However, we believe Lexicon Pharmaceuticals is undervalued with very high chance of bankruptcy for the next two years.

About Contributor

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Raphi Shpitalnik do not own shares of Lexicon Pharmaceuticals. Please refer to our Terms of Use for any information regarding our disclosure principles.

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