NeoGenomics (NEO): A Genomic Stock Worth Checking?

NeoGenomics Inc. (NASDAQ:NEO), founded in 2002, runs a laboratory network across the U.S., with a prime focus on cancer genetics diagnostic testing. It serves a wide range of customers including hospitals, pathologists, clinicians, and researchers, among others. The company says in its mission statement that it wants to improve patient care through remarkable cancer-focused testing services.

The Fort Myers, Florida-based premier cancer diagnostics and pharma services company performed well over the past year. NEO stock started FY 2020 trading at around $30. Its stock price fell over 8 percent on February 27 despite reporting better-than-expected financial results for FY 2019. Subsequently, NEO shares plunged to a 52-week low of $20.47 in March mainly due to increasing worries among investors over the economic impact of the Covid-19 outbreak.

NeoGenomics once again fell below $30 at the end of April after it reported a wider-than-expected loss for Q1. The drop was partly driven by its announcement of raising $300 million through convertible senior notes and common stock back then.

In the first week of July, the company launched 3 new liquid biopsy tests for advanced non–small cell lung cancer (NSCLC), sending its share price above $35 per share.

NEO stock crossed the $40 price mark in the first week of October after the company announced its plans of establishing a clinical research laboratory in China to expand its presence in the global pharma services market. Later that month, it announced strong earnings and revenue for the third quarter.

Overall, NEO’s stock price has increased around 82 percent over the past year. Meanwhile, analysts are also bullish on the company. BTIG analyst Mark Massaro last month issued a “Buy” rating for the stock, with a price target of $60 per share.

Follow Neogenomics Inc (NASDAQ:NEO)

Massaro stated in a research note to clients, “we are positive on NEO’s May 2020 partnership and ownership stake in liquid biopsy company Inivata, as NEO looks to expand its footprint in the high-value liquid biopsy and minimal residual disease (MRD) testing space. We think NEO will likely announce additional deals from here, and we regard NEO as a ‘onestop oncology shop’ as it leverages a leadership position in the pathology and oncology channel.”

Separately, SVB Leerink lifted its price target for NeoGenomics from $50 per share to $60 per share this morning. The research firm currently has an “Outperform” rating for the stock.

Despite bullish analysts’ sentiment, NeoGenomics shares slipped nearly two percent in the mid-day trading Friday. The drop came after the company announced proposed public offerings of its common stock and convertible notes for gross proceeds of $500 million.