CareDx upgraded to Buy from Neutral at BTIG ahead of analyst day

BTIG analyst Mark Massaro upgraded CareDx to Buy from Neutral with a $40 price target following the news last Friday afternoon that Medicare contractor Palmetto GBA decided it will not finalize the more restrictive proposed draft LCD issued in August 2023. CareDx management is pleased with the update, and confirmed that they have been in dialogue with Palmetto for some time, and believe that Palmetto plans to soon retire the more restrictive August 2023 policy which limited surveillance testing and replace it with “something of much the same substance as its original policy,” the analyst tells investors in a research note. Following Friday’s update, the 2024 guidance and numbers look increasingly conservative and CareDx’s legal matters seem to be manageable in light of Medicare’s new approach, BTIG says. CareDx is likely to provide more updates at its October 15 analyst day, BTIG adds.