Why Shares of Guardant Health Jumped This Week
Shares of Guardant Health (NASDAQ: GH) were up 14.4% for the week as of Friday afternoon and rose as much as 15.7% for the week, according to data provided by S&P Global Market Intelligence. The healthcare company specializes in precision oncology diagnostics. Its shares rose for the second week in a row. It closed last week at $26.37 and climbed to as high as $30.56 on Thursday. The stock is up more than 10% so far this year.
Two weeks ago, the stock surged because of positive first-quarter earnings that showed revenue up 34%, year over year. This week, the catalyst for the stock's rise was its Guardant360 liquid biopsy, which looks at circulating cell-free DNA to detect tumor cells. The company said it was receiving health plan coverage from Anthem Blue Cross, Blue Shield, Aetna, and Humana. In addition, in February, UnitedHealthcare said it would cover Guardant360 as a companion diagnostic in advanced lung and breast cancer treatments. The next step will be for the company to see expanded usage of the test. In some cases, it is limited to specific types of breast cancer.
Guardant360 is a companion diagnostic increasingly used in healthcare. It was already approved by Medicare and some private insurers in 2019. The addition of all four major U.S. health insurers means that the biopsy is covered for roughly 300 million lives in the U.S. That expands the company's target market significantly. The company lost $133.5 million in Q1, or $1.30 in earnings per share (EPS) loss, compared to losses of $123.2 million and an EPS loss of $1.21 in the same period last year. The ability to increase testing volume could likely help the company turn a profit as soon as this year.
Source Fool.com
