On Monday, BTIG updated its outlook on Exact Sciences Corp (NASDAQ:EXAS), increasing the price target to $82 from the previous $70 while reiterating a Buy rating on the stock. The adjustment follows a positive reaction from the market to the recent presentation of Exact Sciences' blood-based colorectal cancer (CRC) test data at the European Society of Medical Oncology (ESMO) conference.
The company's stock saw an approximate 5% increase today and has surged around 20% in recent days after the data readout from a study involving around 3,000 patients. The reported data showed an 88.3% overall CRC sensitivity at 90.1% specificity and 31.2% sensitivity for advanced adenomas (AA), exceeding initial expectations. These results outperformed prior assumptions of sensitivity in the low to mid-80s and AA sensitivity in the 20-25% range.
Despite the promising data, Exact Sciences has cautioned that the study is partially case-controlled, which means the sensitivity figures may decline in the upcoming larger, pivotal study. The company has indicated that the final study results are now anticipated in the first half of 2025, a postponement from the previously expected release in the fourth quarter of 2024. The delay is attributed to the need for additional analytical studies related to a new testing platform that incorporates new biomarkers, the specifics of which have not been disclosed by Exact Sciences.
Investors are warned of the potential for sensitivity degradation in the pivotal study, with some expecting a decrease of about 5-8 percentage points in overall sensitivity. Despite this, the recent data has bolstered confidence in the likelihood of Exact Sciences achieving FDA approval and Medicare reimbursement for their blood-based CRC test, positioning them to compete in the market with other laboratories offering similar diagnostics.
In other recent news, Exact Sciences Corporation has reported promising initial data on its blood-based colorectal cancer (CRC) test, leading Citi to reaffirm its Buy rating. The company's test showed an overall CRC sensitivity of 88.3% and a specificity of 90.1%. The company's management is awaiting results from the BLUE-C study, expected in 2025, which will then be submitted to the FDA for review.
Exact Sciences has also reported a 12% year-over-year increase in revenues, reaching $699 million in its second quarter earnings. This growth was driven by the use of its Cologuard test by over a million people and record global patient testing with Oncotype DX. The company has also commenced its Falcon Registry study for Multi-Cancer Early Detection (MCED) at Baylor Scott & White Health in Texas, aiming to enroll up to 25,000 participants.
In terms of analyst ratings, Canaccord Genuity has maintained a Buy rating and a $75.00 price target on shares of Exact Sciences, while Piper Sandler has increased the price target to $85 from the previous $75 while maintaining an Overweight rating. Both firms have highlighted the potential for significant operating leverage for Exact Sciences, particularly with the expected growth of its Cologuard product. These are some of the recent developments for Exact Sciences Corporation.
InvestingPro Insights
Following the positive outlook from BTIG on Exact Sciences Corp (NASDAQ:EXAS), InvestingPro provides additional insights that may be of interest to investors. According to InvestingPro data, Exact Sciences has experienced a strong return over the last three months, with a 56.49% price total return, reflecting investor confidence and market reaction to recent developments. The company's robust revenue growth of 13.54% in the last twelve months as of Q2 2024, also underscores its expanding business despite the lack of profitability during this period.
However, InvestingPro Tips indicate that analysts do not expect the company to be profitable this year, which aligns with the P/E Ratio being negative at -71.45, suggesting that investors are currently valuing the company's growth prospects rather than current earnings. Another point for investors to consider is that Exact Sciences does not pay a dividend, which may influence the investment strategy for those seeking regular income from their holdings. Despite this, the company's liquid assets do exceed its short-term obligations, providing some financial stability.
For investors seeking a more comprehensive analysis, there are additional InvestingPro Tips available on the platform, which can be accessed at: https://www.investing.com/pro/EXAS. These tips may provide further guidance on the investment potential of Exact Sciences Corp in light of recent events and market data.
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