NEW YORK – JP Morgan on Wednesday initiated coverage of Oxford Nanopore Technologies, giving the company's shares an Overweight rating and a June 2023 price target of 725 pence ($9.78).
In a note to investors, analyst James Gordon wrote that Oxford Nanopore is a "differentiated player, operating in an attractive segment, with a very strong long-term top-line growth outlook."
But key risks include competition from established sequencing competitors, potential nanopore-based competition, pressure from falling DNA sequencing prices, and failure to achieve timely profitability.
The UK-based nanopore sequencing firm went public on the London Stock Exchange in September, raising £330.1 million ($445.1 million) and valuing the company at approximately £4.80 billion.
Gordon said he sees the DNA sequencing market doubling to approximately $8 billion by 2025 and expects Oxford Nanopore to "outperform the already strong growth of the DNA sequencing market." The company could achieve break-even in 2025, he added.
In Wednesday trading on the London Stock Exchange, shares of Oxford Nanopore were flat at 591.5 pence.