GenomeWeb Top 40 Rises 10 Percent in July, Following Upward Swing in Broader Market

NEW YORK – Stocks of molecular diagnostics and omics companies were up in July, rebounding from a difficult June.

Overall, the GenomeWeb Top 40 was up 10 percent. In comparison, the Dow Jones Industrial Average was up 7 percent from June, while the Nasdaq was up 12 percent, and the Nasdaq Biotech Index was up 4 percent. Of the 40 firms tracked by GenomeWeb, 33 saw their stock prices rise month over month, and seven saw shares decline in value.

Myriad Genetics led the winners, with its stock price up 45 percent month over month. The company made little news that appeared to drive these gains, though researchers from the US Department of Veterans Affairs did release results from a study indicating that Myriad's GeneSight Psychotropic test improved major depressive disorder remission rates.

Proteomics firm Quantum-Si posted the second largest gain in July, with its shares up 40 percent month over month. There were no specific developments that appeared to drive this jump, though it perhaps reflected a rebound following the large decline in Quantum-Si's share price in June, when it fell 45 percent month over month.

Genetic testing firm Natera was up 33 percent month over month. The company announced in July that it had been selected to participate in UnitedHealthcare’s Preferred Laboratory Network (PLN). UHC incentivizes patients to use labs in its PLN by reducing out-of-pocket costs at those labs. Currently, 12 of UHC's roughly 300 member labs participate in the program.

Genetic testing company Invitae posted the biggest decline in share price during July, as its stock dropped 22 percent month over month. This followed a 34 percent month over month decline in June. On July 18, the company announced preliminary Q2 2022 revenue of roughly $136 million, falling short of analysts' expectations. It also lowered its full-year 2022 guidance and said that it planned to restructure by eliminating non-core operations and geographies and focusing on business segments that deliver sustainable margins and returns.

In a filing with the US Securities and Exchange Commission, Invitae said that the restructuring will result in layoffs of more than 1,000 employees.

Shares of genomic tools company 10x Genomics were down 11 percent month over month. On July 14, the company announced that its preliminary Q2 2022 revenues were down 1 percent year over year. It said it expects revenues of $114.5 million, down from $115.8 million a year ago and below the consensus Wall Street estimate of $127.7 million.

In a note to investors, JP Morgan Analyst Julia Qin said the bank believed the revenue miss was largely driven "by one-time issues" including the China COVID-19 lockdowns and cold chain supply issues in the EMEA region. She added, though, that 10x will "likely see continued pressure" in the second half of the year.

On July 25, Canaccord Genuity initiated coverage of 10x with a Buy rating and a price target of $55.00. In a note to investors issued this week, Canaccord Analyst Kyle Mikson reiterated the Buy rating and maintained the $55.00 price target, noting that despite short-term concerns including its China business and cold chain supply issues, the bank remains "bullish on 10x's long-term growth potential."

Shares of Berkeley Lights were down 10 percent month over month in July, the third biggest drop among the GenomeWeb Top 40. The company did not report any news that appeared to drive the decline.