Myriad Genetics stock upside hinges on hereditary cancer segment

On Thursday, Morgan Stanley initiated coverage on Myriad Genetics (NASDAQ:) stock, a prominent genetic testing provider, with an Equalweight rating and a $32.00 price target.

The company, known for its hereditary cancer screening and pharmacogenomics services, is gaining traction in Oncology and Women’s Health sectors. Myriad Genetics’ main product, the MyRisk hereditary cancer panel, accounts for approximately 44% of the company’s sales for 2023.

According to the firm, Myriad Genetics’ near-term growth is anticipated to be in the double-digit range, aided by recent exits of competitors and revenue cycle management (RCM) initiatives that may help balance the impact of pricing pressures. The company’s focus is on expanding its hereditary cancer business, which remains a significant component of its revenue stream.

Additionally, Myriad Genetics has seen positive developments in non-invasive prenatal screening (NIPS) and carrier screening segments. However, GeneSight, which represents 18% of the company’s 2023 revenues, continues to be a topic of debate among investors. Opinions vary regarding its clinical utility and reimbursement dynamics, though there has been steady progress in these areas.

Myriad Genetics boasts a robust product pipeline, which is expected to support the company’s growth strategy in the coming years. The firm’s analysis suggests that Myriad Genetics is positioned to maintain its status as a key player in the genetic testing market, with a particular emphasis on hereditary cancer diagnostics and its expanding presence in other areas of women’s health and oncology testing.

In other recent news, Myriad Genetics has experienced significant developments, including updates to a pivotal GeneSight study and notable financial performance. The company discontinued part of its GeneSight study due to disparities in baseline hospital resource utilization and costs between the tested and control groups. In financial news, Myriad Genetics reported second-quarter revenues of $211.5 million, exceeding consensus expectations, and raised guidance for 2024 to an estimated $835-845 million.

Several analyst firms, including Wolfe Research, Scotiabank, Jefferies, and TD Cowen, have responded positively to these developments, raising their price targets for Myriad Genetics. The company has also secured a new patent for its molecular residual disease assay technology and is preparing to launch new products between 2025 and early 2026.

These recent developments are based on independent sources and clear evidence, providing a factual overview of the company’s recent activities. It’s important to note that this information doesn’t include any predictions or personal opinions, but solely relies on verifiable facts.

InvestingPro Insights

As Myriad Genetics (NASDAQ:MYGN) continues to make headway in the genetic testing market, real-time data from InvestingPro offers additional insights into the company’s financial health and stock performance. The company’s market capitalization stands at $2.59 billion, indicating its substantial presence in the sector. Despite not being profitable over the last twelve months, analysts have revised their earnings upwards for the upcoming period, signaling potential for future profitability. This is further supported by the fact that analysts predict the company will be profitable this year.

InvestingPro Tips highlight that Myriad Genetics has experienced a significant return over the last week and boasts a strong return over the last three months, reflecting investor confidence in the company’s growth trajectory. The stock’s price movements have been quite volatile, which could be of interest to investors looking for short-term trading opportunities. Additionally, the stock is trading near its 52-week high, currently at 97.17% of the peak, suggesting a bullish sentiment in the market.

For those interested in a deeper analysis, there are 6 additional InvestingPro Tips available for Myriad Genetics, which can be found on the InvestingPro platform. These tips could provide valuable context for Morgan Stanley’s coverage and the company’s potential in the genetic testing market.

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