This may not be perfect timing for a high growth healthcare tech stock, however Guardant Health is a company we want to own, the size of the opportunity and positioning are too good to ignore.
GH is a potentially dominant company within diagnostic tests for genotyping cancers as we think Guardant has a significant first mover advantage: more volume equals more data/intelligence equals higher accuracy.
The August 2020 FDA approval, along with expanded Medicare coverage are likely to be major catalysts to volume, market growth and the adoption of liquid biopsy.
Liquid biopsy is a blood test that enables cancer genotyping.
Comprehensive gene profiling offered by Guardant360 enables doctors to test for ‘all’ genes with one test.
Complexity in treating cancers is increasing, almost 40% of new cancer drugs coming into the market are for targeted gene therapies. This will require companion diagnostics or, a broad gene test such as Guardant 360.
We expect growth to return to high levels after a Covid-induced drop.
Potential Upside: $200 (+100 to 150%)
Sensible Downside: $56 (-38%)
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