NEW YORK (GenomeWeb News) – Sequenom's shares were up 19 percent in Tuesday afternoon trade after investment bank Lazard Capital Markets upgraded the stock to "buy" from "hold."
Sean Lavin, an analyst for Lazard who covers the firm, issued a research note today upgrading the rating and increasing the price target on Sequenom's shares to $13.
Lavin cited the market potential for Sequenom's Down syndrome test, which he expects to reach the market either late in 2011 or in 2012. The US market for such tests is more than $4 billion, he said.
Sequenom's Down syndrome test program was at the center of a scandal that hit the firm nearly a year ago, when it announced that R&D test data had been mishandled. An investigation into that mishandling eventually led to the termination of CEO Harry Stylli and Senior VP of R&D Elizabeth Dragon, among others.
However, the firm has continued developing both a DNA-based and an RNA-based version of the test. Last week, during a conference call following the release of its fourth-quarter and full-year 2009 results, Sequenom Chairman and CEO Harry Hixson said the firm has put its RNA Down syndrome test program on the backburner as the firm allocates its resources to the DNA test program. "We're more optimistic about DNA methods," he said.
Lavin said that last week's 30 percent drop in Sequenom's stock price, following the Q4 results, represented an opportunity for investors.
In mid-afternoon trade on the Nasdaq, shares of Sequenom were up 19 percent at $6.57.