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Pacific Biosciences' (PACB) SMRT Sequencing Holds Promise

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According to the latest scientific publications, Pacific Biosciences of California, Inc. 's PACB Single Molecule, Real-Time (SMRT) Sequencing is being increasingly used to explain intricate genomes and traits of both plant and animal species. The papers demonstrate the superiority of SMRT Sequencing in allowing decisive discoveries, as compared with other sequencing technologies.

It has been proven time and again that with the aid of SMRT Sequencing, it is indeed possible to create high-quality, complete genome assemblies for model and non-model organisms.

Pacific Biosciences' SMRT Sequencing has been instrumental in providing new insights into vital biological characteristics in different organisms. A newly released paper stated the virtually complete draft genome of Oropetium thomaeum, a grass species that has the ability to brave a severe drought and even regrow once water is available. Pacific Biosciences' technology was also used to expose a previously intractable region of the Y chromosome in Drosophila melanogaster.

We believe that Pacific Biosciences' SMRT Sequencing will see increased demand on the back of its ability to unravel completely new traits in various organisms. Higher customer wins for this technology will further help to drive top-line growth for the company.

Last month, Pacific Biosciences launched Sequel system - a nucleic acid sequencing platform based on Single Molecule, Real-Time (SMRT) technology. The company expects to start shipping the product from the fourth quarter of 2015 in the U.S.

The Sequel system was developed under the company's partnership with Roche. Per the agreement, Pacific Biosciences is required to deliver a cohort of initial instruments to Roche for its internal assay development program. Sequel is a more powerful device as compared to the company's legacy PacBio RS II system. The new SMRT Cells in the device contain one million zero-mode waveguides (ZMWs), compared to 150,000 ZMWs in the PacBio RS II.

We believe that Pacific Biosciences has significant growth prospects in plant and animal as well as human genome sequencing. The company's leading position in microbial sequencing also presents it a significant growth opportunity in the infectious disease market.

However, persistent losses and cash burn are the primary headwinds facing the company at present.

Zacks Rank and Key Picks

Currently, Pacific Biosciences carries a Zacks Rank #3 (Hold). Better-ranked stocks in the medical instruments industry are EDAP TMS SA EDAP , Natus Medical BABY and Masimo MASI . All the stocks sport a Zacks Rank #1 (Strong Buy).

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


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

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