Why Opko Health 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, pharmaceutical and diagnostics company Opko Health has received an alarming one-star ranking.

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

Opko facts

Headquarters (Founded)

Miami (2006)

Market Cap

$2.0 billion

Industry

Biotechnology

Trailing-12-Month Revenue

$36.6 million

Management

Chairman/CEO Dr. Phillip Frost (since 2007)
Vice Chairman/Chief Technology Officer Dr. Jane Hsiao (since 2007)

Return on Equity (Average, Past 3 Years)

(23.9%)

Cash/Debt

$42.4 million / $21.4 million

Competitors

Alnylam Pharmaceuticals
Genentech
Merck


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

On CAPS, 17% of the 168 members who have rated Opko believe the stock will underperform the S&P 500 going forward.

Just last week, one of those bears, All-Star TMFBlacknGold, touched on Opko's seemingly unsustainable valuation:

I see a lot of speculation here about a buyout, but let's get back to reality. It doesn't seem likely that any company will pay over $2 billion for just $170 million in net assets and less than $40 million in annual revenue. Opko goes from a measly $5-$6 million in quarterly revenue to $11 and all of a sudden it's the best company ever? Look closer and you'll see that a near doubling in revenue resulted in an even larger loss than last year!

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The article Why Opko Health Is Poised to Pull Back originally appeared on Fool.com.

Fool contributor Brian Pacampara and The Motley Fool have no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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