Sector Update: Health Care Stocks Scratching Out Small Gains; Neogenomics Hits New Record After Q2 Revenue Beat, Raised Outlook


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Health care stocks were narrowly higher Thursday with the NYSE Health Care Sector Index rising less than 0.1% and shares of health care companies in the S&P 500 climbing about 0.1% as a group.

In company news, Neogenomics Inc. ( NEO ) leapt to a record high Thursday after cancer-focused genetics testing company reported Q2 revenue topping analyst estimates and raising its revenue forecast for the fiscal year ending in December.

NEO shares recently were ahead 23.5% at $5.41 each, earlier rising nearly 26% to reach a new, all-time high at $5.51 a share. Over the past 12 months, the stock has risen 65.6% in value.

Revenue for the three months ended June 30 rose 32.7% year over year to $20.7 million, beating the Capital IQ consensus by around $580,000 and the company overcoming a $1.05 million drop in revenue resulting from its interpretation of conflicting Medicare billing rules for genetic tests used to identify the presence or absence of specific DNA sequences on chromosomes.

Net income for the quarter was $274,000, or $0.01, little changed from year-ago levels and matching the Street consensus for the period.

For the current quarter ending in September, NEO is projecting revenue in a range of $22 million to $23.5 million, topping the analyst view by at least $400,000. It sees per-share earnings a penny either side of breaking even, straddling estimates looking for $0.00 per share.

The company also now expects between $83 million to $86 million in FY14 revenue, beating estimates by at least $2.31 million. EPS is seen by NEO in a range of $0.00 to $0.03, in-line with Wall Street expectations for a $0.02 per share profit this year.

In other sector news,

(+) BLFS, (+24.0%) Announces three-year pact with Somahlution LLC to manufacture its DuraGraft medical devices to store blood vessels used in coronary artery bypass procedures. Financial terms were not disclosed.

(-) CBAY, (-8.2%) Plans public offering of 3.5 mln shares of its common stock, with the $18.9 mln in expected net proceeds slated to support ongoing development of its MBX-8025 drug candidate to treat dyslipidemia, steatohepatitis and type 2 diabetes.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Copyright (C) 2014 All rights reserved. Unauthorized reproduction is strictly prohibited.

This article appears in: Investing , Commodities

Referenced Stocks: NEO

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