Why Opko Health Stock Edged Higher in August
According to data from S&P Global Market Intelligence, Opko Health (NASDAQ: OPK), a multinational pharma and diagnostics company, saw its shares rise by 3.39% last month. Although the diversified healthcare company posted strong second-quarter results early in the month, the real catalyst behind this move higher appears to be the positive sentiment surrounding pharma stocks in general. Opko, after all, traded hand in hand with the iShares Nasdaq Biotechnology ETF (NASDAQ: IBB) in August, and even slightly underperformed this broad-based pharma fund last month.
Image source: Getty Images.
While Opko's positive move higher is undoubtedly welcome news for shareholders, the fact remains that this stock remains one of the cheapest within the mid-cap pharma landscape with a trailing price-to-sales ratio of 2.9. Long story short, the market has yet to put much faith in the commercialization of Opko's advanced prostate cancer test 4K Score -- even though the test's sales reportedly grew by a healthy 58% in the first half of 2017 compared to the same period a year ago. Put simply, 4K Score has struggled to live up to its megablockbuster commercial opportunity (estimated $2 billion peak sales opportunity), and that's recently weighed heavily on Opko's valuation.
Source: Fool.com
