Shares of Exact Sciences Corp (NASDAQ:EXAS) were climbing in early trading on Tuesday, ahead of the company’s third-quarter earnings call.
The pullback in the stock since July offers a “pretty compelling entry point,” given the strong Cologuard growth and “a clear path” to more than five years of maintaining growth rates above 10%, according to Piper Sandler.
The Exact Sciences Analyst: David Westenberg upgraded the rating for Exact Sciences from Neutral to Overweight, while keeping the price target unchanged at $90.
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The Exact Sciences Thesis: The entire lab landscape has underperformed with interest rates being “higher for longer,” Westenberg said in the note.
“Given the low penetration rate, we think Cologuard could sustain high growth, even with competitive entrance,” the analyst wrote.
“Incremental Cologuard margins have reached 75% (with the company targeting over 80%), meaning this company has the opportunity to drive the highest profitable growth in the industry,” Westenberg stated. Exact Sciences could reach an adjusted EBITDA of $518 million by in 2025, with upside to these estimates.
EXAS Price Action: Shares of Exact Sciences had risen by 3.01% to $66.40 at the time of publication Tuesday.
