In my opinion, Pandora is the epitome of wasted dollars in social media advertising for large and medium-size businesses. The reason is simple: listeners give no attention to the radio advertisements. I use Pandora and often switch to a different station when an advertisement comes on. I would argue that traditional radio is more effective than Pandora’s Internet-based radio.
Sequenom, Inc. (NASDAQ:SQNM)
Thursday, March 7 after market close; EPS ($0.23) / Revenue $32.0 million
This former biotechnology high-flier traded in the mid-teens during 2008 and 2009. Sequenom, Inc. (NASDAQ:SQNM) manufactures biomedical products for DNA detection and genetic sequencing. In other words, the company’s diagnostic products have applications in cancer research, agricultural genomics, and in vitro testing for prenatal and retinal disorders (i.e. baby inside the mother).
Sequenom, Inc. (NASDAQ:SQNM) currently has a market capitalization of $500 million. For Thursday’s earnings release, investors will be looking for traction in Sequenom’s MaterniT21 product as well as upside to 2013 guidance.
MaterniT21 is the brand name product for estimating a woman’s risk for having trisomy-21, or a Down Syndrome’s pregnancy. Wall Street is bullish on Sequenom, Inc. (NASDAQ:SQNM) as insurance carriers are beginning to offer a reimbursement for the test.
UnitedHealth will begin coverage of the MaterniT21 prenatal test in April. Analysts at Piper Jaffray upgraded Sequenom to Overweight from Neutral with a $6.50 price target. In its note to clients, Piper cited upside to Sequenom’s 2013 guidance based on potential reimbursement from Aetna, Humana, and others.
In February, Aetna stated in a company document that it favored testing of cell-free fetal nucleic acids with at-risk women. Analysts on Wall Street are connecting Aetna’s comments with Sequenom indicating that the insurance carrier will likely pick up coverage of the MaterniT21 test.
Foolish Bottom Line
Among the three companies outlined above, I am bullish on Foot Locker and neutral on Sequenom. I recommend buying shares of Foot Locker ahead of Friday’s earnings call.
Unfortunately, I am bearish on Pandora as the company’s advertising model has no visible return-on-investment for corporate advertisers. Shareholders of Pandora could see significant upside if the company was acquired by an outside party (i.e. Apple or Google), however that reason alone isn’t sufficient enough to own the stock. I do not believe Apple or Google will acquire.
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The article Upcoming Reports Are Make-or-Break for These Companies originally appeared on Fool.com and is written by John Macris.
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