Skip to main content
Premium Trial:

Request an Annual Quote

GenomeWeb Index Rises 3 Percent in October as Q3 Earnings Reports Drive Gains, Losses

NEW YORK (GenomeWeb) – The GenomeWeb Index rose more than 3 percent in October, rebounding from a slow 1 percent gain in September as uncertainty over the fate of the Affordable Care Act and disappointment at the Centers for Medicare and Medicaid Services' preliminary 2018 prices for clinical lab tests gave way to enthusiasm and dissatisfaction over third quarter earnings and preliminary financial reports.

The Index underperformed the Dow Jones Industrial Average and the Nasdaq, which gained 4 percent and nearly 4 percent, respectively, but significantly outperformed the Nasdaq Biotechnology Index, which fell 6 percent in October. Stock performance in the October GenomeWeb Index was mostly positive as 15 of the 26 stocks saw gains and only 11 saw losses.

Exact Sciences was October's biggest winner, with a 17 percent increase in share price. The company reported after the close of the market on Monday that its Q3 revenues rose 158 percent year over year, driven by a 136 percent increase in the number of completed Cologuard colon cancer tests. Exact significantly beat analyst estimates on both the top and bottom lines, and raised its guidance for both revenues and test volume for full-year 2017.

This is Exact's second month in a row in the top three — the company's stock gained 12 percent in September.

Foundation Medicine gained 12 percent in October. The company announced at the beginning of the month that it had received approval from the New York State Clinical Laboratory Evaluation Program for its FoundationACT blood-based circulating tumor DNA assay. All of its genomic profiling tests are now available in all 50 states.

Waters and PerkinElmer were tied for third with 9 percent gains each in October. Though there was no obvious reason for PerkinElmer's boost in stock price, Waters recently reported a 7 percent increase in Q3 revenues driven by solid demand across its end markets, including particularly strong sales to government and academic customers. The company beat analyst estimates on the top and bottom lines.

NanoString Technologies led the decliners in October with a 38 percent drop in stock price. The company reported on Oct. 11 that it had calculated preliminary total revenue of approximately $25.9 million to $26.9 million for Q3, which included product and service revenue of approximately $16.9 million — a significant shortfall from the firm's previous guidance of $19.5 million to $21.5 million from products and services.

GenMark Diagnostics and NeoGenomics Laboratories also fell significantly in October, losing 23 percent and 22 percent, respectively. GenMark's loss had no obvious cause, but the company's stock has been on a steady decline since it reported somewhat disappointing second quarter earnings results in August. At the time, Cowen analyst Doug Schenkel attributed the decline to "details on revenue mix, orders, and margins" that heightened uncertainty among investors.

NeoGenomics posted a 4 percent increase in Q3 revenues on Oct. 25, but fell short of Wall Street estimates on the top and bottom lines. On a conference call with analysts following the release of the earnings, NeoGenomics Chairman and CEO Douglas VanOort said the firm was disappointed in its performance for the quarter and "did not deliver what our investors were expecting, and we accept full accountability for that." He added that Hurricanes Harvey and Irma resulted in lab closures, as well as "serious" disruptions to business.