GenomeWeb Top 40 Up 11 Percent in November, Reversing String of Declines

NEW YORK – Stocks of molecular diagnostics and omics companies were up in November, rebounding strongly after posting losses in the previous three months.

Overall, the GenomeWeb Top 40 was up 11 percent. By comparison, the Dow Jones Industrial Average was up 9 percent, the Nasdaq was up 11 percent, and the Nasdaq Biotech Index was up 5 percent. Of the 40 firms tracked by GenomeWeb, nine saw their stock prices fall month over month and 31 saw their share prices rise.

CareDx posted the largest gain in November, with shares up 79 percent month over month. The jump came despite a third quarter in which the firm reported a 15 percent decrease in revenues year over year. The company suffered a blow earlier in the year when MolDx issued a decision limiting reimbursement for allograft testing. During a call following release of its Q3 results, CareDx CFO Abhishek Jain said that the company has adapted to the decision and is making progress toward positive operating cash flow.

At the beginning of the month, the company announced that its former President and CEO Reginald Seeto had resigned effective Nov. 1 and had been replaced by an Office of the CEO consisting of board chairperson Michael Goldberg, CFO Jain, and President of Patient and Testing Services Alexander Johnson that would oversee the company while it searched for a permanent CEO.

In a note to investors following the release of the company's Q3 earnings, investment bank BTIG noted that the company's business appeared to have stabilized and reiterated its Neutral rating on CareDx.

Personalis posted the second largest gain in November, with shares up 59 percent month over month.

The company reported Q3 revenues of $18.3 million, up 23 percent from $14.9 in Q3 2022, and raised its full-year revenue guidance to a range of $73 million to $74 million from a previous range of $70 million to $72 million.

Also during November, Myriad Genetics and Personalis announced a partnership in which Myriad will market Personalis' ImmunoID NeXT platform to certain pharmaceutical partners. Additionally, Peronalis and Tempus Labs announced a deal to jointly commercialize Personalis' NeXT Personal Dx minimal residual disease assay.

Twist Bioscience reported the third largest gain, with shares up 53 percent month over month.

During the month, the company reported 17 percent year-over-year growth in its fiscal fourth quarter revenues.

In a note to investors, however, JP Morgan analyst Rachel Vatnsdal said that while the company has seen solid demand for its core business, the bank sees the firm’s risk-reward balance "skewed to the downside relative to the rest of our coverage" and maintained its Underweight rating.

NanoString Technologies posted the largest decline in November, with its shares down 64 percent month over month. The company's stock price plummeted on the news that 10x Genomics won a $31 million jury verdict in its patent infringement lawsuit against NanoString. The firm plans to appeal the verdict, but investment bank TD Cowen downgraded shares of NanoString to Market Perform, citing the legal risk to its spatial genomics product portfolio, a large debt balance, and increased competition.

Invitae posted the second largest decline in November, with shares down 16 percent month over month. The company reported a 9 percent year-over-year decline in Q3 revenues. In a note to investors, JP Morgan's Vatnsdal maintained the bank's Underweight rating.

Burning Rock Biotech saw the third largest decline in November, with shares down 13 percent month over month. The company reported a roughly 18 percent year-over-year decline in Q3 revenues driven by falling testing volumes as the company shifted its focus to its in-hospital business.