Depomed, Inc. (NASDAQ: DEPO) shares fell on Tuesday February 14 on lower trade volume than normal after a number of analysts weighed in on the investing value of the stock with a downgraded rating.
Meanwhile U.S. stocks opened slightly lower on Tuesday. The main three benchmarks retreated after touching the latest in a series of record highs on Monday, with the S&P 500 index SPX, -0.09% down two points, or 0.1%, to 2,326.
The Dow Jones Industrial Average DJIA, -0.02% fell 34 points, or 0.2%, to 20,381. The Nasdaq Composite Index COMP, -0.13% shed eight points, or 0.1%, to 5,756.
Analysts at Mizuho downgraded shares of Depomed, Inc. (NASDAQ: DEPO) from Buy to Neutral in a research note to investors today. Mizuho currently has a rating of Neutral on the stock. A number of other analysts have commented on the stock in recent days, and the company has earned a consensus one-year price target of $23.91, above the opening price of $16.44. Depomed, Inc. stock has a 52-week high of $27.02. considerable and integral digressions in the company’s actions, future direction or industry can cause downgrades as the analysts believe that the future prospects for the security have diminished from the original recommendation.
Yesterday Depomed, Inc. (NASDAQ: DEPO) shares last traded at $16.52, which is a drop of $0.48 from the previous closing price. Opening at $16.44, they ranged from $16.05 and $16.65 throughout the day.
Depomed, Inc. (NASDAQ: DEPO) currently has a market cap of 1.02B.
Depomed, Inc. (NASDAQ: DEPO) Average Daily Trading Volume
The stock’s average daily volume is 1,428,100 shares out of a total float 50,558,000 and some 300,136 shares crossed the trading desk yesterday, 16 percent below the norm. lower than normal. Look for trading volume to pick up in the coming days as investors often use swings in trading volume to identify heavy volume accumulation or distribution by institutional investors.
While increased trading for one day will not mean much, however, a trend of heavy trading volume on the buy side over a period of days or weeks sends a positive signal to market traders that institutions may be moving in, so institutional sponsorship is very important.
Institutional sponsorship is defined by ownership of a stock by mutual funds, banks, pension funds and other large institutions.
These instituitional investors have teams of analysts researching thousands of stocks. Thus, watching their interests is a good way to ensure you are buying the right stocks.
Depomed, Inc. (NASDAQ: DEPO) Moving Averages
A moving average can also act as support or resistance. In an uptrend a 50-day, 100-day or 200-day moving average may act as a support level, as shown in the figure below.
This is because the average acts like a floor (support), so the price bounces up off of it.
In a downtrend a moving average may act as resistance; like a ceiling, the price hits it and then starts to drop again.
By spotting trends, moving averages allow investors to make those trends work in their favor and increase the number of successful trades.
Trades for Depomed, Inc. (NASDAQ: DEPO) have ranged from $12.25 – 27.02, and the stock now has a 50-day MA of $18.31 and 200-day MA of $20.77. Today’s last price is 38.86%% below the 52 week high of $27.02.
Earnings growth is a critical factor to consider when buying stocks and investors watch for companies that have raised their earnings by at least 25% for the past 3 years.
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