Shares of NeoGenomics (NASDAQ:NEO) soared more than 24% on Thursday despite reporting mixed fourth-quarter results. The rally reflected investors’ optimism about the company’s ongoing restructuring and growth initiatives and an upbeat 2023 outlook.
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NeoGenomics is a clinical laboratory specializing in cancer genetics diagnostic testing and pharma services.
The company reported a loss of $0.18 per share, above the Street’s expectations of a loss of $0.16. The figure, however, compared favorably with a loss of $0.34 per share in the prior-year quarter.
Meanwhile, revenue grew 10% year-over-year to $139 million and surpassed the consensus estimate of $130.4 million. In the reported quarter, higher revenue from the Clinical Services and Pharma Services segments supported top-line growth. Further, Clinical test volume increased by 2% year-over-year.
It is worth highlighting that NeoGenomics initiated an organizational restructuring process during the quarter. It expects this move to result in about $25 million of annual operating savings and support revenue growth. The reorganization also includes the integration of Inivata, which the company acquired in June 2021.
Outlook
NeoGenomics expects full-year sales of $545 million to $555 million in 2023, reflecting an increase of 7% to 9% year-over-year. Moreover, it anticipates a net loss in the range of $107 million to $116 million.
What is NeoGenomics’ Price Target?
On TipRanks, NEO stock has an average price target of $15, which implies 9.8% downside potential from the current level. Also, based on two Buy ratings assigned in the past three months, NeoGenomics has a Moderate Buy consensus rating. The stock is up about 83% so far this year.
