NEW YORK – William Blair said on Monday that it has initiated coverage of 10x Genomics with an Outperform rating.
The investment bank did not provide a price target for shares of the Pleasanton, California-based firm.
"The company’s Chromium platform has established itself as the clear leader in the single-cell market and 10x has used this as a jumping off point to develop solutions to help researchers understand biology at a resolution and scale not available with legacy technologies," Analyst Matt Larew said in a statement. "Its Visium platform for spatial analysis, launched in November 2019, has shown encouraging signs of adoption and validation. With several important product launches planned by the first half of 2022, we expect 10x will soon separate itself as the leader in the field of spatial genomics as well."
In a research note, Larew and Analyst Brian Weinstein wrote that 10x's "evolving ecosystem of solutions and the total addressable market-expanding potential of spatial and in situ provide growth potential largely unmatched across the life science space, while management’s track record of product development should give investors confidence in 10x's ability to redefine the way biological analysis is performed."
"Over time, we expect the addressable market for 10x solutions to expand significantly as the company further develops the single-cell, spatial, and in situ markets," Weinstein said in a statement.
Risks include highly competitive end markets, reliance on government funding and budget cycles for sales, dependence on access to funding and valuation expectations for mergers and acquisitions opportunities, and the pandemic's impact on the ability of labs to operate at full capacity.
William Blair acted as co-manager in 10x's September 2020 $440 million public offering of common stock.
Cowen, JP Morgan, Evercore ISI, and Bank of America initiated coverage of 10x in October 2019.
In morning trading on the Nasdaq, shares of 10x were flat at $170.19.