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On Thursday, Personalis, Inc. (NASDAQ: NASDAQ:PSNL) saw its price target increased by Needham. The new target is set at $5.50, up from the previous $3.50, while the firm maintained a Buy rating on the stock.
This adjustment follows Personalis' second-quarter financial results, which surpassed the consensus expectations for both revenue and earnings per share (EPS).
The company reported a significant year-over-year revenue growth of 35% in the second quarter of 2024, a marked improvement from the 4% growth observed in the first quarter. This surge was primarily driven by the company's oncology segment, which helped to balance a decline in revenue from the VA Million Veteran Program (VA MVP). Personalis' management also revised its revenue guidance for 2024 upward, signaling confidence in the company's growth trajectory.
Personalis has been making strides with its NeXT Personal minimal residual disease (MRD) test, which is currently in an early access program phase. Additionally, the commercial launch of NeXT Personal by Tempus began in the latter part of the second quarter.
The firm's analysts have noted the management's plans to seek reimbursement for three indications in the upcoming year, although they anticipate that test volumes will remain constrained until reimbursement is secured.
The investment firm reiterated its positive stance on Personalis, citing the company's accelerating revenue growth as a key reason for the raised price target. The firm's outlook remains optimistic about Personalis' future performance and market position.
In other recent news, Personalis, Inc. has reported significant first-quarter earnings in 2024, with revenues reaching $19.5 million, surpassing their expectations. This represents a 55% year-over-year growth in the company's biopharma business.
Personalis has also settled a patent dispute with Foresight Diagnostics, Inc., granting Foresight a non-exclusive, worldwide license to develop, manufacture, and commercialize products and services utilizing whole genome sequencing. In return, Foresight will pay Personalis tiered royalties on net sales of products and services covered by the licensed patents.
Needham has maintained a Buy rating on Personalis, following the presentation of two studies at the American Society for Clinical Oncology 2024 Annual Meeting. The studies highlighted the efficacy of the NeXT Personal Minimal Residual Disease assay in early-stage breast cancer detection and immunotherapy monitoring in metastatic cancers.
Despite reimbursement concerns regarding their 330 MRD test, Personalis aims to secure reimbursement approval for three or four indications this year.
These are the latest developments in the company's ongoing progress. Personalis is engaged with top biopharma companies, including Moderna (NASDAQ:MRNA), and is building a strong intellectual property position with new patents. The company is also aiming for a revenue target of $100 million by 2025.
InvestingPro Insights
In light of Needham's updated price target for Personalis, Inc. (NASDAQ: PSNL), a glance at recent InvestingPro data and tips can provide additional context for investors. The company holds a market capitalization of $149.58 million, indicating its size within the biotechnology sector. While the P/E ratio stands at -1.6, reflecting the company's current lack of profitability, this is not uncommon in the growth-focused biotech industry. Importantly, Personalis has seen a revenue growth of 7.96% over the last twelve months as of Q1 2024, underscoring the accelerating growth noted by Needham.
InvestingPro Tips highlight that Personalis has more cash than debt on its balance sheet, which is a positive sign of financial health and may reassure investors of the company's stability. Additionally, two analysts have revised their earnings upwards for the upcoming period, suggesting that the market sentiment around the company's financial prospects is improving. On the other hand, the company is quickly burning through cash, which is a critical consideration for investors monitoring the company's sustainability and long-term strategy. For those interested in a deeper analysis, there are over 10 additional InvestingPro Tips available on the platform, which can provide further insights into Personalis' performance and stock behavior.
Overall, these metrics and insights from InvestingPro should be considered alongside the optimistic outlook from Needham, offering a more nuanced view of Personalis' financial health and market potential.
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