GenomeWeb Top 40 Falls 7 Percent in May As Broader Market Delivers Mixed Results

NEW YORK – Stocks of molecular diagnostics and omics companies were down in May against the background of a mixed broader market.

Overall, the GenomeWeb Top 40 was down 7 percent. By comparison, the Dow Jones Industrial Average was down 3 percent, while the Nasdaq was up 6 percent, and the Nasdaq Biotech Index was down nearly 3 percent. Of the 40 firms tracked by GenomeWeb, 22 saw their stock prices fall month over month, 17 saw their share prices rise, and one saw no change in price.

Immunoassay firm Quanterix posted the biggest gain in May as its stock price rose 55 percent month over month. Quanterix was also the Top 40's biggest winner in April when it posted a 12 percent month-over-month jump in price. The company reported a 4 percent year-over-year decline in Q1 revenues driven by a drop in instrument sales, but still beat the consensus Wall Street estimates for both revenue and net loss per share. The company also revised its full-year 2023 revenue guidance to $104 million to $111 million, up from the previous range of $103 million to $109 million.

Following release of the Q1 results, two investment banks changed their price targets for Quanterix stock, with TD Cowen revising it from $15 to $20 and Canaccord Genuity raising it from $13 to $19.

Fulgent Genetics posted the second-largest gain in May, with its stock rising 34 percent month over month. The company reported during the month that its Q1 2023 core revenues were up 150 percent year over year, though its overall revenues were down 79 percent due to a drop in COVID-19-related revenues. The company reported Q1 revenues of $66.2 million and an adjusted loss per share of $.22, both beating the consensus Wall Street estimates of, respectively, $56 million and $.43.

Fulgent raised its full-year 2023 revenue guidance from $240 million to $250 million.

Guardant Health saw the third-largest rise in stock price in May as its shares were up 30 percent. The company reported during the month that its Q1 revenues rose 34 percent year over year to $128.7 million from $96.1 million in Q1 2022, beating the consensus Wall Street estimate of $117.9 million.

Guardant also announced it has received new commercial health plan coverage for its Guardant360/Guardant 360 CDx liquid biopsy cancer profiling test from Anthem Blue Cross and Blue Shield, Aetna, and Humana.

Investment bank UBS initiated coverage of Guardant in May with a Buy rating and price target of $40. In a research note, UBS analysts Elizabeth Garcia and Christopher Mercado noted the company's "leading position in liquid biopsy therapy selection [for] oncology, where there is still a multiyear runway for continued penetration of this oncology market."

NanoString Technologies saw the biggest drop in stock price in May with shares down 40 percent month over month. The company reported Q1 2023 revenues of $35.8 million, up from $31.1 million last year and beating Wall Street analysts' average estimate of $33.1 million. However, its net loss for the quarter of $.86 per share exceeded the consensus Wall Street estimate of $.73 per share. For full-year 2023, NanoString increased its revenue guidance to between $175.0 million and $185.0 million, up from its previous outlook of $170.0 million to $180.0 million.

The company suffered a legal setback, though, as a German court awarded competitor 10x Genomics a permanent injunction that will force NanoString and its German subsidiary to cease selling its CosMx Spatial Molecular Imager instrument and RNA detection reagents in that country.

Invitae shares fell 21 percent month over month, the second-largest decline in May among the GenomeWeb Top 40. The genetic testing company posted a 5 percent year-over-year drop in Q1 revenues, reporting $117.4 million in sales compared to $123.7 million for the same quarter in 2022. Nonetheless, it beat analysts' average estimate of $116.6 million. Its loss per share of $.37 likewise beat analysts' average estimate of $.39.

Also in May, a jury in the US District Court for the District of Delaware awarded Natera $19.4 million in damages for royalties and lost profits in a patent lawsuit against Invitae and ArcherDx.

Personalis posted the third-largest decline in May as its stock price also dropped 21 percent. The drop came despite a Q1 2023 earnings report that saw revenues grow 24 percent to $18.9 million from $15.2 million a year ago.

*Bio-Techne paid a dividend of $.08 on May 12.

Note: PerkinElmer's name was changed to Revvity last month after divesting its applied, food, and enterprise businesses.