CareDx (CDNA) AI Stock Analysis

• Market Cap: $962.75M
• Dividend Yield: N/A
• Average Volume (3M): 767.95K
• Price to Earnings (P/E): 17.0
• Beta (1Y): 1.91
• Revenue Growth: 19.07%
• EPS Growth: N/A
• Country: US
• Employees: 644
• Sector: Healthcare
• Sector Strength: 76
• Industry: Medical - Diagnostics & Research
• EPS (TTM): 1.02
• Shares Outstanding: 55,425,900
• 10 Day Avg. Volume: 599,619
• 30 Day Avg. Volume: 767,949
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 3.21
• Price to Cash Flow (P/CF): 12.20
• P/FCF Ratio: 12.20
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $27.83
• Price Target Upside: 61.05% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 4

CareDx presents a mixed outlook with a notable strength in its recent financial performance and positive earnings call sentiment. The company has shown strong revenue growth and improved profitability, supported by strategic expansions and operational efficiencies. However, technical indicators suggest caution with current stock momentum, and valuation is moderate with no dividend yield. The overall score reflects a balanced view of these factors, highlighting the company's growth potential while acknowledging short-term operational and market-related challenges.

Positive Factors

Cash Position

CDNA generated $22M of cash flow from operations in Q4 and holds $261M of cash, indicating a strong financial position.

Financial Performance

Revenue grew 30% YoY in 4Q24; $370M in revenue anticipated for 2025.

Stock Valuation

Shares of CDNA are trading at a roughly 2-turn discount to its peers, suggesting the stock is undervalued given its strong market position and positive cash flow.

Negative Factors

Investment Risks

Investment risks include failure of AlloMap and AlloSure tests to achieve commercial success due to market size, penetration rate, reimbursement and/or competition.

Net Loss

Net loss was between $32-34M for 4Q24 and between $58-60M for FY2024.

Stock Price Movement

Shares of CDNA have pulled back ~20% since its analyst day.

CareDx Business Overview & Revenue Model

Company Description

CareDx, Inc. (CDNA) is a leading precision medicine company dedicated to the discovery, development, and commercialization of clinically differentiated, high-value healthcare solutions for transplant patients and caregivers. With a focus on improving long-term outcomes in transplant recipients, CareDx provides non-invasive diagnostic solutions, including testing services, products, and digital healthcare solutions, primarily in the United States. The company operates in the biotechnology sector, leveraging advanced technologies to offer comprehensive and personalized insights that enhance patient care.

How the Company Makes Money

CareDx generates revenue primarily through the sale of its diagnostic testing services and products tailored for transplant patients. The company's key revenue streams include the AlloSure and AlloMap tests, which are proprietary molecular diagnostic solutions utilized to monitor organ transplant recipients. These tests are designed to detect organ rejection and assess the health of transplanted organs, thus improving patient management and outcomes. CareDx also earns income from partnerships and collaborations with healthcare providers, research institutions, and pharmaceutical companies, which contribute to its service offerings and market reach. Additionally, the company offers digital health solutions that provide patient management tools and data analytics services, adding to its revenue portfolio. The combination of these diverse revenue streams enables CareDx to maintain a robust financial model focused on innovation and superior patient care.

CareDx Financial Statement Overview

Summary

CareDx demonstrated significant improvements in profitability and cash flow in 2024, marking a positive shift in financial health. The company has managed to grow its revenue and convert it into profits, with a strong equity position and low leverage. However, fluctuations in cash flow and the decrease in total equity highlight areas for caution and further improvement in operational efficiency and cash management.

Income Statement

CareDx showed strong revenue growth with a 19.1% increase in 2024 compared to 2023. The company turned profitable in 2024 with a net profit margin of 15.7%, a significant improvement from a negative margin in prior years. The gross profit margin remained consistent at 100%, indicating stable cost management relative to revenue. However, EBIT and EBITDA margins were low at 12.2%, suggesting room for operational efficiency improvements.

Balance Sheet

The company's debt-to-equity ratio is low at 0.06, indicating low leverage and a strong equity position. The equity ratio is high at 77.1%, reflecting a robust equity base relative to total assets. Return on equity (ROE) improved to 13.9% in 2024, showing enhanced profitability. Despite these strengths, total equity decreased from 2022, highlighting potential risks in sustaining equity levels.

Cash Flow

CareDx's free cash flow in 2024 was positive at $38 million, a turnaround from negative figures in previous years, indicating improved liquidity and cash management. The operating cash flow to net income ratio was 0.72, suggesting most of the net income was converted into cash. However, free cash flow growth trends have been unstable, with substantial fluctuations year over year.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
333.79M	280.32M	321.79M	296.40M	192.19M
	Gross Profit
333.79M	178.32M	209.58M	199.01M	129.08M
	EBIT
40.77M	-203.36M	-77.23M	-29.73M	-17.71M
	EBITDA
-33.99M	-89.66M	-61.22M	-17.84M	-10.21M
	Net Income Common Stockholders
52.55M	-190.28M	-76.61M	-30.66M	-18.71M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
260.65M	235.42M	293.09M	348.49M	224.70M
	Total Assets
491.05M	466.83M	542.99M	566.62M	368.51M
	Total Debt
22.26M	34.22M	39.00M	17.39M	16.07M
	Net Debt
-92.43M	-47.98M	-50.92M	-331.09M	-118.60M
	Total Liabilities
112.62M	205.50M	112.08M	100.75M	90.83M
	Stockholders Equity
378.43M	261.33M	430.91M	465.88M	277.68M
Cash Flow		Free Cash Flow
38.05M	-27.63M	-49.57M	-39.55M	23.07M
	Operating Cash Flow
38.05M	-18.39M	-25.24M	-19.29M	33.43M
	Investing Cash Flow
-483.00K	40.45M	-228.50M	47.71M	-100.39M
	Financing Cash Flow
-5.61M	-29.61M	-4.54M	185.64M	163.15M

CareDx Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 17.28
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CDNA, the sentiment is Negative. The current price of 17.28 is below the 20-day moving average (MA) of 18.45, below the 50-day MA of 20.86, and below the 200-day MA of 23.14, indicating a bearish trend. The MACD of -0.88 indicates Negative momentum. The RSI at 36.89 is Neutral, neither overbought nor oversold. The STOCH value of 18.70 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CDNA.

CareDx Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CDNA	68 Neutral	$962.75M	16.99	19.46%	―	19.07%	―
NTRA	67 Neutral	$18.75B	―	-19.42%	―	56.75%	59.77%
EXAS	53 Neutral	$8.23B	―	-37.09%	―	10.37%	-389.98%
MYGN	51 Neutral	$767.91M	―	-17.15%	―	12.15%	61.33%
ILMN	49 Neutral	$12.10B	―	-30.11%	―	-2.93%	-4.69%
GH	49 Neutral	$5.19B	―	-4584.47%	―	31.04%	16.91%
Sector *	48 Neutral	$6.36B	1.09	-49.92%	2.63%	17.17%	0.95%

CareDx Corporate Events

CareDx Updates CFO Severance Agreement Amid Leadership Changes

On March 27, 2025, CareDx, Inc. announced an Amended and Restated Change of Control and Severance Agreement with its CFO, Abhishek Jain. This agreement outlines severance benefits for Mr. Jain in the event of a change of control or termination, impacting the company’s executive compensation structure and potentially influencing stakeholder perceptions regarding leadership stability.

CareDx Reports Strong 2024 Financial Results and Growth

CareDx announced its financial results for the fourth quarter and full year of 2024, reporting a 19% increase in total revenue to $333.8 million. The company saw significant growth in testing services revenue and volume, with a notable improvement in net income and adjusted EBITDA compared to the previous year. The company also highlighted its strategic focus on expanding testing services and payer coverage, positioning itself for continued growth in 2025. The Board of Directors authorized a common stock repurchase program of up to $50 million, indicating confidence in the company’s financial health and future prospects.

CareDx Announces Strong Revenue Growth and Outlook

CareDx announced its preliminary financial results for the fourth quarter and full year of 2024, highlighting a significant 30% year-over-year revenue growth in the fourth quarter and a full-year revenue projection between $332 million to $333 million. The company anticipates strong growth in 2025 with expected revenue of $370 million, supported by the expansion of its sales and marketing team and continued momentum in kidney surveillance testing. Despite a projected GAAP loss, CareDx achieved positive adjusted EBITDA, indicating operational efficiency and financial health improvements.

CareDx Updates Director Compensation and Vesting Policies

CareDx, Inc. announced amendments to its outside director compensation policy, which include changes to the vesting schedules for stock options and restricted stock unit awards for non-employee directors, ensuring full vesting before the annual stockholders’ meeting if it occurs before the one-year anniversary of the award. Additionally, the company removed quarterly retainers for Michael Goldberg, the Board Chairperson, for his previous role in the Office of the CEO, and updated outdated references to an older equity plan.