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GenomeWeb Index Gains 8 Percent in August, Continues to Outperform Broader Stock Market

NEW YORK (GenomeWeb) – The GenomeWeb Index rose for a fifth straight month in August, gaining nearly 8 percent for the second month in a row.

The index outperformed the Dow Jones Industrial Average, which gained 2 percent; the Nasdaq, which gained nearly 6 percent; and the Nasdaq Biotechnology Index, which was up nearly 5 percent. Stock performance in the August GenomeWeb Index was overwhelmingly positive, as 23 of the 28 stocks saw gains, many of them in the high double digits. Only five stocks in the index saw losses last month.

CareDx took the top spot in August with an 81 percent increase in share price, while Invitae (+68 percent) and NanoString Technologies (+38 percent) rounded out the top three gainers.

The biggest loser in July was Luminex, whose shares declined 17 percent. Hologic (-7 percent) and Waters (-4 percent) completed the list of bottom-three performers.

CareDx's shares soared after the firm announced a 48 percent increase in second quarter revenues in early August. The company credited the year-over-year increase to continued momentum from its kidney transplant test AlloSure, and said testing revenues in particular rose 67 percent in Q2. CareDx also raised its guidance for full-year 2018, and now expects revenues of $68 million to $70 million. The firm had previously guided for revenues of $64 million to $66 million for the year.

Invitae, meanwhile, saw its Q2 revenues more than double, driven by 139 percent growth in testing volume. The company attributed the strong performance to several factors, including payment from Medicare for deletion/duplications analysis, improved collections from other third-party payors, and new partnerships with institutions and pharmaceutical partners. Invitae also raised its guidance based on the strength of its financial performance during Q2, and is now expecting annual revenues of $135 million to $140 million for 2018, up from an earlier guidance of more than $130 million.

The firm further filed a shelf registration with the US Securities and Exchange Commission on Aug. 10, noting that it could offer up to $250 million of common and/or preferred stock, debt securities, depositary shares, or warrants. Invitae also said it had signed a sales agreement with Cowen and Company allowing for the sale up to $75 million of its common stock.

Despite a 28 percent drop in Q2 revenues, NanoString's shares rose dramatically in August. Though overall revenues were down, they were in line with Wall Street expectations and with the company's own preliminary earnings report. Further, NanoString noted that its product and services revenues for the quarter grew 11 percent year over year to $20.4 million and exceeded its prior guidance of $18.5 million to $19.5 million.

NanoString is now expecting total revenues of $104 million to $106 million for the year compared to an earlier guidance of $100 million to $105 million. Its net loss is expected to be $68 million to $72 million, or $2.50 to $2.70 per share, compared to previous guidance of $65 million to $75 million, or $2.60 to $2.90 per share.

Luminex led the decliners in August despite a 4 percent increase in Q2 revenues. Its shares fell more than 20 percent on Aug. 7 after President and CEO Homi Shamir conformed that LabCorp's last order from Luminex for its NuSwab product — the foundation of the LabCorp women's health portfolio — was placed in the second quarter. Analysts noted that the loss of the LabCorp business will impact Luminex's profitability and that the firm's earnings per share in the quarter was lower than their estimates.