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Earnings Season Sees Investors Sour on 'Omics Tools, MDx Firms

NEW YORK (GenomeWeb News) – As second-quarter financial reports continue to roll in, investors have been unimpressed with the results offered by many of the 'omics tools and molecular diagnostics firms that comprise the GenomeWeb Daily News Index.

Several firms in the Index missed Wall Street estimates in reporting their results in July and some trimmed their forecasts for the year. This resulted in heavy hits to several stocks, including those of Sequenom (-31 percent), Luminex (-30 percent), and Cepheid (-28 percent), during the month. Rosetta Genomics also fell 31 percent, but it has yet to report its Q2 results.

Sequenom last week posted a 38 percent increase for its second-quarter revenues, but the firm fell nearly $1 million short of the consensus estimate. Its stock fell despite the firm upping its forecast to 50,000 MaterniT21 Plus tests billed in 2012 from an earlier goal of 40,000.

Luminex yesterday reported a 1 percent drop in Q2 revenues year over year and missed Wall Street's consensus estimate. Though its shares fell 4 percent yesterday, the key driver for the month's decline was its announcement earlier in July that it was acquiring GenturaDx for $50 million plus additional consideration. The firm believes GenturaDx's technology will pair well with its MultiCode RTx chemistry in a sample-to-answer molecular diagnostic system aimed at the hospital lab market.

Shares of Cepheid fell after the firm reported its Q2 revenues had jumped 21 percent, but it also missed the consensus Wall Street estimate. The firm also lowered its EPS guidance for the year.

Among the best performers for the month were Nanosphere (+35 percent) and GenMark Diagnostics (+30 percent).

Nanosphere's shares climbed following a public offering of stock that raised $26.9 million. The firm also reported a 160 percent rise in Q2 revenues, though it also missed analysts' estimates.

Overall, the GWDN Index fell around 4 percent for July. In comparison, the Dow Jones Industrial Average gained 1 percent, the Nasdaq was nearly flat, and the Nasdaq Biotech Index climbed 3 percent.

Ed. note: Gen-Probe has been replaced by Hologic in the GWDN Index following the close of Gen-Probe's acquisition today.