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On Friday, Bernstein SocGen Group increased the price target on Guardant Health stock (NASDAQ:GH) to $60 from the previous target of $45, while keeping an Outperform rating on the company’s shares. According to InvestingPro data, analyst targets for the stock currently range from $34 to $65, with the company maintaining a GOOD overall Financial Health Score.
Guardant Health reported fourth-quarter earnings that surpassed expectations, with total revenues reaching $202 million, which was 7% higher than consensus estimates. The company’s gross margin for the quarter was reported at 62%, exceeding consensus estimates by 2 percentage points. InvestingPro analysis shows impressive revenue growth of 31% over the last twelve months, with strong liquidity indicated by a current ratio of 4.68. Following the positive earnings report, the company provided guidance for 2024, projecting revenues between $850 million and $860 million and non-GAAP gross margins of 62-63%.
The firm noted that Guardant Health’s strong forecast for fiscal year 2024 and the expected acceleration in 2025 would allow the company to increase investments, particularly in sales and marketing. Despite this, Guardant Health has committed to capping its annual spending for the Shield franchise at a maximum of $200 million.
After the market closed, the stock saw a slight decline, despite having seen a significant increase of over 50% year-to-date and 109% over the past year. The analyst expressed a continued bullish stance on Guardant Health, acknowledging potential risks in 2025, especially concerning competition from Exact’s blood-based colorectal cancer (CRC) test results. However, the analyst also identified potential positive catalysts and opportunities for Guardant Health to exceed expectations, particularly in the screening market.
In other recent news, Guardant Health reported fourth-quarter revenue of $201.8 million, surpassing analyst expectations of $186.78 million and marking a 30% year-over-year increase. The company’s adjusted earnings per share were -$0.62, better than the estimated -$0.78. Additionally, Guardant Health’s precision oncology revenue grew to $184.6 million, driven by a 24% increase in clinical test volume and a 16% rise in biopharma tests. For the full year 2024, total revenue reached $739.0 million, a 31% increase from the previous year. Looking forward, Guardant Health has raised its 2025 revenue guidance to between $850 million and $860 million, slightly above the analyst consensus.
Citi analysts responded positively by raising their price target for Guardant Health to $60, maintaining a Buy rating. BofA Securities also increased their price target to $56, continuing to recommend a Buy rating. Both firms noted the company’s strong revenue forecasts and volume growth, particularly in the oncology and screening segments. Guardant Health’s Shield test was highlighted for its inclusion in the NIH Vanguard multi-cancer detection study. The company is also anticipating a significant acceleration in volume growth for its products G360 and Shield, with expected improvements in Medicare pricing for Shield.
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