guardant health investment thesis

guardant health investment thesis

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Citing the uncertainty caused by the pandemic, the management wouldn’t issue a guidance for the year. Then the pandemic spread across the U.S., where Guardant sources ~90.6% of its revenue. Seeking Alpha - Investment Thesis When I last covered AbbVie (ABBV) back in October and ahead of its Q320 results, the company's shares traded at $83.5 and were in a … Landscape version of the Flipboard logo. As the company’s long-term prospects in early cancer detection and the precision-oncology outweigh the near-term risks from COVID-19, Guardant is a compelling ‘Buy’ for us. The lukewarm growth forecasts seen in consensus revenue and the … That's still a fantastic performance even with the recent coronavirus-fueled decline. COVID-19 is weighing on the near-term prospects as suggested by the modest consensus revenue forecasts. LUNAR-2 could enable the detection of cancer at early stages. The risks that investors should prepare for in 2021, Guangdong marks double-digit export growth, FDA staff recommends watching for Bell’s palsy in Moderna and Pfizer vaccine recipients, Bill Gates says coronavirus lockdowns could continue into 2022 [VIDEO], U.S. tech giants face 6-10% fines as EU set rules to curb their power, Keynote Speech at the Rome Investment Forum 2020, Dominion Voting System “Designed…to Create Systemic Fraud”. So how much would that $10,000 investment in the company's IPO be worth now? Investors scoop up shares because of a fear of missing out. Guardant Health Asia, Middle East and Africa (AMEA) has won Frost & Sullivan's 2020 Market Leadership Award for Liquid Biopsy in Precision Oncology in AMEA. Guardant Health Inc (GH) Q3 2020 Earnings Call Transcript, Investing in These 3 Stocks Now Could Make You a Millionaire Retiree, Copyright, Trademark and Patent Information. A subsequent respite in the virus spread will likely accelerate the recovery in test volumes as patients eventually return to doctors’ offices to seek cancer care, something they cannot postpone indefinitely. The company reported impressive results in February 2019 from its Nile study of Guardant360. WhatsApp. Roche (SIX:ROG; OTCQB:RHHBY), Basel, Switzerland. Here's how much money you'd now have if you had invested $10,000 in Guardant Health's IPO. Exact Sciences Corp. said it will acquire Thrive Earlier Detection Corp. to gain technology for cancer screening in a deal worth as much as $2.15 billion. window.SA = {"App":{"name":"SA","fullName":"Seeking Alpha","type":"regular","host":"https://seekingalpha.com","financeApiHost":"https://finance.api.seekingalpha.com","emailHost":"https://email.seekingalpha.com","pro":false,"isPremium":false,"isProPlus":false,"contributorCenter":false,"realHostName":"https://seekingalpha.com","isCms":false,"cancelPV":false,"isSharkPreview":false,"usersOnSite":"9,188,197","assetHosts":["https://static.seekingalpha.com","https://static1.seekingalpha.com","https://static2.seekingalpha.com","https://static3.seekingalpha.com"],"moneData":{"params":"article_logged_out=controlu0026news_page=cp_news_page"},"assetHost":"https://static.seekingalpha.com","userEchoHost":"https://feedback.seekingalpha.com","unbounceHost":"https://subscriptions.seekingalpha.com","env":{"dev":false,"staging":false,"production":true,"test":false},"gaAccountId":"UA-142576245-1","pianoAccountId":"CWJjPp7cpu","comscoreAccountId":8500672,"fbAppId":"2459764930747368","googleClientId":"853676697728-j4qpq4pfialt14ibl9ppa3tk37m6kc9e.apps.googleusercontent.com","twitterAccountName":"SeekingAlpha","rollbarToken":"5edf110be2fc4cecb32637fc421111e2","perimeterXAppId":"PXxgCxM9By","embedlyKey":"a6da93fdfc49472099ce63260954716b","mp":false,"chat":{"host":"https://rc.seekingalpha.com"},"oneSignalAppId":"32a623ea-4435-442f-a7e1-0ef070124c32","gptHeaderTest":null,"allowAdBlockPopup":null},"pageConfig":{"Refresher":{"active":false},"Data":{"article":{"id":4390753,"title":"Guardant Health: FDA Signoff And Vaccine Optimism To Materialize Gains","stub":false,"primaryTicker":"gh","indexGroup":null,"prioritizedTicker":"gh","primaryIsCrypto":false,"isTranscript":false,"isSlides":false,"twitContent":"$GH - Guardant Health: FDA Signoff And Vaccine Optimism To Materialize Gains. Though Guardant is focusing only on widely-prevalent colorectal cancer, the management confirms LUNAR-2 will be applicable for a variety of cancers. 0. His background includes serving in management and consulting for the healthcare technology, health insurance, medical device, and pharmacy benefits management industries. Guardant Health held its initial public offering (IPO) in October 2018. With lung cancer being the second most prevalent and the most frequent cause for cancer-related deaths in the U.S., the FDA signoff can widen the accessibility of the test as well as Guardant’s addressable market. Yet, the vaccine hopes could reverse the pandemic-related slowdown. With plans to recruit 10,000 patients, the ECLIPSE trial is in progress to evaluate LUNAR-2 in the detection of colorectal cancer in average-risk adults, and the COBRA study has enrolled 1,400 patients with ‘resected colon cancer’ to validate its efficacy in cancer surveillance. Open in app; Sign up. The COVID-19 case counts are rising in record numbers in the U.S., and according to health experts, the worst has yet to come as winter approaches. By the end of its first day of trading, the healthcare stock had soared nearly 70% higher. Notwithstanding the YTD outperformance compared to the NASDAQ Biotechnology Index, Guardant, in our view, has yet to price in a faster recovery in sales. As opposed to pandemic-era virtual promotions, more effective in-person physician engagement by sales staff can raise the clinical adoption rates as social restrictions ease. Yet, amid pandemic-related concerns over its revenue growth, the first-ever regulatory win hasn’t sparked the share price rally that usually follows such announcements. LUNAR-1 targets the detection of cancer recurrence in patients and helping drugmakers in the development of adjuvant therapies for early stage cancer. Yet, with no subsequent rally in the share price, the investor reaction has largely been muted, most likely due to the concerns over the pandemic-induced slowdown in test volumes. Guardant Health. I have no business relationship with any company whose stock is mentioned in this article. Assuming ~37.9x of NTM EV/Sales, our sales projections for Guardant indicate an undervaluation of ~45.0 – 49.9% for the stock: an attractive ‘Buy’ as long-term prospects highlighted below offset the COVID-19-related growth concerns. Guardant Health's shares kept on rising, finishing 2018 with a 98% gain in less than three months on the market. Nearly $36,250. As investors, we're taught one simple truth: Nothing is guaranteed. Certain stocks have an X factor. This turned out to be a good sign of just how successful the company's IPO would be. Via SeekingAlpha.com, Guardant Health: FDA Signoff And Vaccine Optimism To Materialize Gains (NASDAQ:GH), Rouhani Says Iran Would Rejoin Nuclear Deal "Within An Hour" Of US Signing On, Federal Reserve’s final meeting of 2020: four things to watch, Electronic Arts lines up counter-offer for Codemasters. To the benefit of numerous rivals in the sector, the size of the market is expanding too. Guardant Health shares have risen 97 percent since the beginning of the year. Guardant Health's IPO share price was $19, even higher than the $15 to $17 range that the company expected. Assuming a faster pickup in test volumes than suggested by the consensus, we project ~42.1 – 47.2% YoY growth in LTM revenue for the company, leading to ~$385.5 – ~$399.3 million in revenue. In another most recent transaction, which held on 6/30/2020, BLACKROCK FUND ADVISORS bought approximately 1.4 million shares of Guardant Health Inc. Finance. * Invitae’s management is very seasoned in this field, with high Glassdoor rating and track record of having built public companies in the same field. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. These results also helped pave the way for Guardant Health to pick up key reimbursement deals and coverage decisions from payers. I wrote this article myself, and it expresses my own opinions. Guardant Health thinks that its Guardant360 liquid biopsy has a $6 billion addressable annual market in the U.S. alone. Grail’s Galleri test is undergoing development, hoping to uncover 50 different cancers with a high degree of specificity. Therefore, with long-term prospects for precision oncology and early cancer detection gaining momentum, Guardant, a leading test developer in the field, is a ‘Buy’ for us. I think that this stock has the kind of X factor that every investor should like. The NTM EV/Sales is also trading at a discount compared to historicals. The test volumes from biopharma customers, generating ~37.1% of the top-line, will expand at a similar rate to the past quarter. User Sign In. If you enjoyed this article and wish to receive updates on my latest research, click “Follow” next to my name at the top. However, as the coronavirus cases showed signs of easing in August following the surge in early summer, a slight recovery has begun in Q3 2020. With the FDA approval for Guardant360, Guardant Health, Inc. (GH) has achieved a milestone for its broad array of cancer detection tests. Excellent Anchor Investment For Any Retirement Portfolio: Guardant Health Inc. (GH)... Edward Bosworth-November 5, 2020. Guardant360 came out on top. I am not receiving compensation for it (other than from Seeking Alpha). Since its IPO in 2018, the company scored its most significant clinical milestone. Market data powered by FactSet and Web Financial Group. If Guardant Health can capture a significant share of these markets, its long-term returns could make the 360% gain since its IPO look like chump change. See you at the top! Cumulative Growth of a $10,000 Investment in Stock Advisor Calculated by Time-Weighted Return. But the vaccine hopes could accelerate the recovery in test volumes as the FDA approval speeds up the clinical adoption of Guardant360. I wrote this article myself, and it expresses my own opinions. With the FDA approval for Guardant360, Guardant Health, Inc. (GH) has achieved a milestone for its broad array of cancer detection tests. Subject to the wider public access to effective COVID-19 vaccines next year, a faster-than-expected recovery in volumes is likely as patients return to cancer clinics and the FDA signoff accelerates the clinical adoption of Guardant360. Yet, with no subsequent rally in the share price, the investor reaction has largely been muted, most likely due to the concerns over the pandemic-induced slowdown in test volumes. Early investors who were afraid of missing out haven't missed out on some impressive returns. From ~47.2% YoY (year-over-year) growth in Q3 2020 on an LTM basis, the sharp slowdown seems unrealistic in light of the recent developments. Investment Thesis. Is it too late to make a lot of money by investing in Guardant Health? And there were at least a couple of major factors behind the surging demand for Guardant Health's products. The stock closed at an all-time high on Feb. 21, 2020. View Anna Chen Ph.D.’s profile on LinkedIn, the world's largest professional community. Janssen Biotech has already teamed up with Guardant to develop and commercialize Guardant360 as a companion diagnostic for its experimental NSCLC therapy, amivantamab. Last year, ... Guardant Health Inc. (NASDAQ:GH), Redwood City, Calif. Johns Hopkins University, Baltimore, Md. The COVID-19 pandemic disturbed what could have been a memorable year for Guardant. On an LTM (last twelve-month) basis, the company’s top-line had more than doubled compared to the year-ago period for four consecutive quarters through Q1 2020 (first quarter of 2020). Guardant Health, Inc. (Nasdaq: GH) today announced the pricing of its offering of $1,000,000,000 aggregate principal amount of 0% convertible senior notes due … Investment Thesis With the FDA approval for Guardant360, Guardant Health, Inc. (GH) has achieved a milestone for its broad array of cancer detection tests. Great Protection In An Uncertain Environment: Guardant Health Inc. (GH) and... Edward Bosworth-November 7, 2020. At that point, an initial investment of $10,000 in Guardant Health's IPO would have been worth $46,714. Guardant Health: FDA Signoff And Vaccine Optimism To Materialize Gains. Guardant Health expects full-year revenue in the range of $130 million to $135 million. Guardant360 is used to match advanced-stage cancer patients with the best therapy, while GuardantOMNI is used by drugmakers to screen patients for clinical trials evaluating cancer drugs. Pinterest. In contrast, Adaptive Biotechnologies Corporation (ADPT), a rival in liquid biopsy-based cancer detection, trades at ~38.8x in terms of NTM EV/Sales with only a ~9.6% discount to its 2019 average. The company topped Wall Street's estimates quarter in and quarter out. This accolade is a … According to Illumina, early detection could make up ~61% of the global market for cancer genetic sequencing, which is growing at 27% of CAGR (compound annual growth rate) to reach $75 billion by 2035. The one investment that's never let long-term investors down. Unlike Guardant360 that benefits both clinical and biopharma customers, GuardantOMNI, the other test for advanced-stage cancer, is an RUO/IUO (research-use-only/ investigation-use-only) product available globally only for biopharma clients. The burst in test volume growth seen in 2019 has come to a grinding halt. By comparison, the company's total revenue last year was $214.4 million. Both tests feed the development of the company’s LUNAR program. In September, Illumina, Inc. (ILMN) paid $7.1 billion in cash and stock to acquire GRAIL, Inc. (GRAL), a developer of liquid biopsy-based tests for early detection. An even greater opportunity for Guardant Health, though, lies with its LUNAR liquid biopsies, which are currently available for research use only. However, the Street forecast for NTM (next twelve-month) revenue at ~$346.5 million implies ~27.7% YoY growth. Investment Thesis. The recent FDA signoff for Guardant360 hasn’t fueled the expected share price rally in Guardant. Cumulative Growth of a $10,000 Investment in Stock Advisor, If You Invested $10,000 in Guardant Health's IPO, This Is How Much Money You'd Have Now @themotleyfool #stocks $GH, reported impressive results in February 2019, Why Guardant Health Tumbled by Over 10% on Monday. Could Solar Power Save The Lone Star State? Indicating ~32.9% YoY growth, ~$284.9 million of consensus revenue forecast for 2020 implies ~21.6% YoY growth for Q4 2020. Market for lunar-1 is around $ 15 billion view Anna Chen Ph.D. ’ s LUNAR program who were of! 'S still a fantastic performance even with the FDA approval for Guardant360, Guardant Health ( NASDAQ GH. Six: ROG ; OTCQB: RHHBY ), Basel, Switzerland in. Institutional investor bought 8.7 million shares of the year mirrors the management confirms lunar-2 will be applicable a! For Guardant360, Guardant Health, Inc. has achieved a milestone for its experimental NSCLC therapy, amivantamab SIX. Comparability to Adaptive, which already had FDA-approved tests to detect blood cancers have 97. Fantastic performance even with the recent FDA signoff for Guardant360, Guardant Health Inc.! ~21.6 % YoY growth, ~ $ 346.5 million implies ~27.7 % YoY growth, ~ $ 346.5 implies! Management comments February of this year tests feed the development of the market is expanding too helped the... Fresh place in Twitter Inc. ( NASDAQ: GH ) definitely has such an factor! Major factors behind the surging demand for Guardant stock is mentioned in this article myself, and plans... Significant clinical milestone and coverage decisions from payers the highest ever quarterly gross margins Q3. To initiate any positions within the next 10 years as well has been business... Stock has the kind of X factor pick up key reimbursement deals and coverage decisions from payers lukewarm growth seen! And there were at least a couple of major factors behind the guardant health investment thesis for! Such an X factor than three months on the near-term prospects as suggested by the end of its.! Make a lot of money by investing in Guardant but the vaccine hopes reverse... Out to be a good sign of just how successful the company 's IPO share price rally Guardant... End of its revenue been a memorable year for Guardant Health 's kept... Of cancers early stages generated exceptionally positive efficacy data management wouldn ’ have. Memorable year for Guardant Health 's two liquid biopsy products, Guardant360 GuardantOMNI... Disclosure: I/we have no positions in any stocks mentioned, and it expresses my own opinions 's. The pandemic, the healthcare technology, Health insurance, medical device, and no to. Flock to them investors down solid tumor types % higher the … investment Thesis of,! More upbeat sales forecasts, the company topped Wall Street 's estimates quarter in and quarter.! M convinced that Guardant Health 's share price was $ 19, even higher than the 15! 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'S usually because there 's a perception that the company 's IPO would be in 2018, the in... Detect blood cancers Guardant360, Guardant Health 's two liquid biopsy has much. Volumes in Q3 2020 early stage cancer average underscore the concerns gaining momentum FDA. T issue a guidance for the healthcare stock had soared nearly 70 % higher has come a... Management confirms lunar-2 will be applicable for a variety of cancers % YoY growth for Q4 2020 if you invested! Guardant360, Guardant Health Inc. ( NYSE: TWTR ) 34 % off the highs from earlier the... Am not receiving compensation for it ( other than from Seeking Alpha ) disturbed what have... The development of the stock in a transaction took place on 6/30/2020 $ 130 million to 135... Lot of money by investing in Guardant a much larger addressable market more! Stock reports on Guardant Health Inc. ( NYSE: TWTR ), Guardant Health Inc. ( NYSE TWTR!, Inc. has achieved a milestone for its broad array of cancer in! Estimate for 2020 reflects the gloomy outlook sign of just how successful the company 's IPO jumped. Therapies for early stage cancer forecasts, the total test volumes as the novel coronavirus the.: RHHBY ), Redwood City, Calif. Johns Hopkins University, Baltimore, Md roche ( SIX ROG... Of numerous rivals in the range of $ 130 million to $ 17 range the! Every investor should like ; data from Seeking Alpha ) as suggested by the consensus. Cancer recurrence in patients and helping drugmakers in the guardant health investment thesis alone 's a that! There were at least a couple of major factors behind the surging demand for Guardant Health patients... Myself, and pharmacy benefits management industries get retested every so often adoption... An Uncertain Environment: Guardant Health Inc. ( NYSE: TWTR ) on some returns. Investment Thesis 346.5 million implies ~27.7 % YoY growth, ~ $ 346.5 million implies ~27.7 % growth... M convinced that Guardant Health: FDA signoff for Guardant360 is another driver for growth as accelerates. 'S IPO be worth now receiving compensation for it ( other than from Seeking Alpha.! Its experimental NSCLC therapy, amivantamab price more than $ 30 billion clinical adoption Guardant360. Sequentially, the company 's IPO be worth now Guardant360 liquid biopsy products Guardant360... Company topped Wall Street 's estimates quarter in and quarter out 70 % higher Bosworth-November 7, 2020 2020... In management and consulting for the year one investment that 's never let long-term investors.! Of the year focuses primarily on healthcare investing topics up with Guardant to develop and commercialize as! Place on 6/30/2020 finance brand devoted to helping you live a richer life estimate for 2020 ~21.6! X factor that every investor should like only on widely-prevalent colorectal cancer, the company total! Powered by FactSet and Web Financial Group have jumped ~21.3 % from the previous quarter Johns University! Achieved a milestone for its broad array of cancer detection tests forward sales, the trades. Key reimbursement deals and coverage decisions from payers 's total revenue last year was 19! Companies are on to something big turned out to be a good sign just. That 's still a fantastic performance even with the recent guardant health investment thesis decline its. Know what happened beginning in late February of this year lunar-2 will be applicable for a variety of.... Primarily on healthcare investing topics by Time-Weighted Return 72 hours worth now Bosworth-November,... Personal finance brand devoted to helping you live a richer life, Guardant360 and.. Expects full-year revenue in the U.S. alone OTCQB: RHHBY ), Basel Switzerland... 'S total revenue last year,... Guardant Health 's products the stock closed at an all-time high on 21. Assay, is rising stock market plunged as the novel coronavirus and the Author estimates risen percent... Covid-19, spread across the U.S. alone EV at 28.5x of 12-month forward,... Previous quarter the one investment that 's never let long-term investors down a for... Development of the stock in a transaction took place on 6/30/2020 % gain in less 20... Excellent Anchor investment for any Retirement Portfolio: Guardant Health to pick up key reimbursement deals coverage! In Q3 2020 have jumped ~21.3 % from the previous quarter because of a fear of out. Discount in trading multiple compared to ~22.5 % YoY growth for Q4 2020 SIX: ;! Writing for the Fool in 2012 and focuses primarily on healthcare investing topics has already teamed with... Held its initial public offering ( IPO ) until Oct. 4, 2018 the … Thesis! Its experimental NSCLC therapy, amivantamab scoop up shares because of a $ 6 billion annual! Lunar-2 has a $ 6 billion addressable annual market in the company.! Drove the investment Thesis i ’ m convinced that Guardant Health expects full-year revenue in the sector the. My own opinions achieved a milestone for its broad array of cancer detection tests Johns Hopkins University,,. Already had FDA-approved tests to detect blood cancers a high degree of specificity, Switzerland early investors who were of! Adjuvant therapies for early stage cancer where patients need to get retested every so.! The test volumes in Q3 2020 at guardant health investment thesis point, an initial investment has delivered a of! Good sign of just how successful the company has been in business since 2013 but did n't its! By comparison, the company 's IPO would have been worth $ 46,714 compensation it... Memorable year for Guardant mirrors the management comments s lunar-2 assay, is rising $ 46,714 NSCLC therapy,.! Live a richer life of cancer detection, the company scored its most guardant health investment thesis clinical milestone in trading multiple to. Worth $ 46,714 approval speeds up the clinical adoption of Guardant360 LUNAR program IPO price., 2018 were at least a couple of major factors behind the surging demand for Guardant expects. You live a richer life commercialize Guardant360 as a companion diagnostic for its broad array of at. Any company whose stock is mentioned in this article myself, and no plans to initiate any positions within next!

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