T2 Biosystems, Inc. Faces Volatility & Uncertainty Amid Negative EPS - Hold or Watch Closely

Fundamental Analysis

T2 Biosystems, Inc. (TTOO) is currently traded on the NASDAQ exchange under ticker TTOO. Currently, the company faces a negative earnings per share (EPS) of -$2.74, indicating a loss in the previous financial year. Therefore, the negative PE ratio (-0.11) is anticipated due to the negative EPS ratio. This indicates that the company is not profitable at the moment.

On the market capitalization front, TTOO is a small-cap company, with a market cap of approximately $99.41 million. It has an outstanding share count of 333.58 million, which is considered high, especially for a company in the small-cap category.

Looking at the news surrounding TTOO, it seems like the company is trying to navigate a tough period. From being indicated as a meme stock with a possible rise to $1 in August, T2 Biosystems' share prices have contracted from a high this year of $6.5 to the last close at $0.298. The company is currently trading below $1, a situation they aim to address in their upcoming annual stockholders' meeting.

Technical Analysis

TTOO's shares closed at $0.298 on September 12, 2023, up by 0.04 (14.35%) from the previous close. Despite this positive movement, it remains far below the year's high of $6.5 and closer to the year's low of $0.054. The stock's fluctuation within the day ranged from $0.275 (price low) to $0.3265 (price high), indicating a relatively small intraday trading range.

The stock's Average True Range (ATR) of 25.65 indicates a high level of volatility, which seems to be a common attribute among small-cap stocks. The stock is currently trading under its 50-day and 200-day moving averages, which were at $0.255 and $0.6677, respectively. This might be seen as a bearish signal by some traders.

The Relative Strength Index (RSI14), used to measure the speed and change of price movements, stands at 33, which is close to the oversold region (below 30) and might indicate a potential price reversal.

The MACD (3-month) value of 0.010253, slightly positive, could signal some bullish momentum. Additionally, with a support level of $0.25 and resistance at $0.31, investors would be looking for a breakout in either direction.

Predictions and Recommendation

Given both fundamental and technical elements, T2 Biosystems, Inc.'s stock looks somewhat volatile and unpromising in terms of its current financial situation as reflected in their negative EPS. Short-term recovery seems possible observing the RSI being in oversold territory and their latest price close was closer to resistance level than the support level. However, considering the fact that it underperformed moving averages in longer periods, TTOO stock mainly appears to be on a downtrend.

For the next trading day (September 13, 2023), the stock price could see slight growth due to the signs of oversold conditions. Yet, for the upcoming week, it seems wise to wait for more bullish signals, such as a cross above the stock's moving averages and a more decisive move away from the oversold region.

Investors should also watch out for tangible outcomes from their annual meeting on a plan for the company to recover to $1 stock price. Until then, the bottom line would be to treat TTOO as a 'Hold', particularly for investors who have already invested in the stock. For others, it remains a risky prospect due to current uncertainties and might be worth watching until a clearer perspective emerges on the company's upcoming plans.