Hold Recommendation for Pacific Biosciences Amid Mixed Performance and Market Challenges

Pacific Biosciences (PACB – Research Report), the Healthcare sector company, was revisited by a Wall Street analyst today. Analyst Tejas Savant from Morgan Stanley maintained a Hold rating on the stock and has a $2.00 price target.

Tejas Savant has given his Hold rating due to a combination of factors surrounding Pacific Biosciences’ recent performance and market conditions. The company reported a solid first quarter, with revenue slightly exceeding expectations, primarily driven by better-than-anticipated consumables sales and some early purchases from China ahead of potential tariffs. However, the overall revenue saw a year-over-year decline, and the instrument revenue was lower than expected due to fewer Revio system placements and uncertainties in academic funding.
Despite strong traction with the newly launched Vega systems, the challenges in the academic market and the impact of tariffs on instrument sales into China remain concerns. The company’s guidance was modestly lowered at the low end, providing some cushion against these uncertainties. While there are positive aspects such as the growing base of Revio systems and manageable tariff impacts, these are balanced by the headwinds in the academic sector and the need to monitor EU rates, leading to the Hold recommendation.

In another report released on May 15, Piper Sandler also reiterated a Hold rating on the stock with a $1.25 price target.