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Guardant Health (GH)
NASDAQ:GH
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Guardant Health
(NASDAQ:GH)
49Neutral
Positive Factors
Insurance Coverage
GH announced that Shield had received coverage by a key healthcare insurance program for U.S. veterans.
Market Opportunity
There is a near-term access to almost $20 billion of Precision Oncology total addressable market between Colorectal, Breast, and Lung indications.
Reimbursement Increase
GH obtained ADLT status for its blood-based Shield CRC test, which increases the company's Medicare rate for Shield from $920 to $1,495 per test, marking a significant milestone in the diagnostics industry.
Negative Factors
Competition
Smart Liquid Biopsy is highlighted as a differentiated platform versus tissue-based competition.
Reimbursement Strategy
The strategy is likely to focus on only signing private-payer contracts that are at or near the list price, resulting in little degradation from the list price.
Guardant Health (GH) vs. S&P 500 (SPY)
Market Cap
$5.41B
Dividend YieldN/A
Average Volume (3M)2.05M
Price to Earnings (P/E)―
Beta (1Y)1.61
Revenue Growth31.04%
EPS Growth16.91%
CountryUS
Employees1,999
SectorHealthcare
Sector Strength74
IndustryMedical - Diagnostics & Research
Share Statistics
EPS (TTM)-3.56
Shares Outstanding123,421,440
10 Day Avg. Volume1,635,568
30 Day Avg. Volume2,046,252
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)7.70
Price to Cash Flow (P/CF)-22.10
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$56.47Price Target Upside37.26% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering20
Guardant Health Business Overview & Revenue Model
Company DescriptionGuardant Health, Inc. is a leading precision oncology company that focuses on developing and commercializing blood-based tests for cancer detection, treatment, and monitoring. Operating primarily in the healthcare and biotechnology sectors, the company offers innovative diagnostic solutions that enable personalized cancer care. Its core products include liquid biopsy tests, such as Guardant360, GuardantOMNI, and Guardant Reveal, which provide comprehensive genomic profiling to inform treatment decisions and track disease progression.
How the Company Makes MoneyGuardant Health generates revenue through the sale of its proprietary liquid biopsy tests, which are used by healthcare providers for cancer diagnosis, treatment selection, and ongoing patient monitoring. The company's revenue model is primarily based on the volume of tests conducted and reimbursed by healthcare payers, including insurance companies and government programs. Additionally, Guardant Health collaborates with pharmaceutical companies to support clinical trials and drug development, providing another stream of revenue. Strategic partnerships and licensing agreements further enhance its earnings potential by expanding its market reach and technological capabilities.
Guardant Health Financial Statement Overview
Summary
Guardant Health demonstrates strong revenue growth, but faces significant challenges with profitability and financial stability. High debt levels, negative equity, and persistent negative cash flows are serious concerns that require strategic restructuring.Income Statement
Guardant Health has shown consistent revenue growth over the years, indicating strong market demand. However, the company continues to operate at a loss with negative EBIT and net income margins, suggesting challenges with profitability and cost management.42
Neutral
Balance Sheet
The balance sheet reveals a high debt-to-equity ratio due to negative stockholders' equity, indicating financial instability and potential liquidity risks. The negative equity ratio further highlights a leverage concern, which could restrict future financing options.30
Negative
Cash Flow
Cash flow statements show a negative free cash flow, reflecting operational challenges in generating cash. The company has a history of negative operating cash flows, which are concerning for long-term sustainability without external financing.35
Negative
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 739.02M | 563.95M | 449.54M | 373.65M | 286.73M | Gross Profit |
| 449.22M | 336.90M | 293.21M | 250.74M | 194.19M | EBIT |
| -443.59M | -564.73M | -544.38M | -411.00M | -254.95M | EBITDA |
| -390.12M | -433.31M | -614.91M | -359.62M | -225.07M | Net Income Common Stockholders |
| -436.37M | -479.45M | -654.59M | -384.77M | -246.28M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 839.98M | 1.17B | 1.01B | 932.75M | 1.79B | Total Assets |
| 1.49B | 1.79B | 1.61B | 2.20B | 2.27B | Total Debt |
| 1.34B | 1.35B | 1.37B | 1.36B | 847.86M | Net Debt |
| 810.51M | 220.23M | 1.23B | 868.67M | 14.88M | Total Liabilities |
| 1.63B | 1.63B | 1.55B | 1.56B | 916.19M | Stockholders Equity |
| -139.65M | 158.68M | 60.18M | 645.00M | 1.30B |
| Cash Flow | Free Cash Flow | |||
| -274.94M | -345.46M | -386.92M | -284.05M | -157.99M | Operating Cash Flow |
| -239.86M | -324.98M | -309.46M | -209.02M | -103.93M | Investing Cash Flow |
| -261.31M | 840.25M | 149.82M | -63.16M | -617.09M | Financing Cash Flow |
| -996.00K | 477.38M | -189.09M | -66.82M | 1.41B |
Guardant Health Technical Analysis
Negative
41.14
Price Trends
43.90
Negative
39.89
Positive
33.26
Positive
Market Momentum
0.44
Positive
46.92
Neutral
40.20
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GH, the sentiment is Negative. The current price of 41.14 is below the 20-day moving average (MA) of 43.59, below the 50-day MA of 43.90, and above the 200-day MA of 33.26, indicating a neutral trend. The MACD of 0.44 indicates Positive momentum. The RSI at 46.92 is Neutral, neither overbought nor oversold. The STOCH value of 40.20 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GH.
Guardant Health Risk Analysis
Guardant Health disclosed 68 risk factors in its most recent earnings report. Guardant Health reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Guardant Health Peers Comparison
Overall Rating
UnderperformOutperform
Sector (48)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $9.15B | 22.35 | 58.41% | ― | 11.84% | 42.04% | |
67 Neutral | $20.54B | ― | -19.42% | ― | 56.75% | 59.77% | |
61 Neutral | $3.21B | 68.17 | 10.45% | ― | 4.88% | -13.56% | |
52 Neutral | $8.45B | ― | -37.09% | ― | 10.37% | -389.98% | |
50 Neutral | $7.58B | ― | -1252.79% | ― | 30.38% | -195.58% | |
49 Neutral | $5.41B | ― | -4584.47% | ― | 31.04% | 16.91% | |
48 Neutral | $6.36B | 1.28 | -45.04% | 2.64% | 19.24% | 1.69% |
* Healthcare Sector Average
Performance Comparison
GH
Guardant Health
41.14
22.46
120.24%
EXAS
Exact Sciences
43.74
-29.21
-40.04%
NTRA
Natera
143.28
46.57
48.15%
MEDP
Medpace Holdings
282.33
-119.97
-29.82%
SHC
Sotera Health
10.60
-0.82
-7.18%
TEM
Tempus AI, Inc. Class A
40.29
3.81
10.44%
Guardant Health Earnings Call Summary
Earnings Call Date: Feb 20, 2025 | % Change Since: -13.21% | Next Earnings Date: May 7, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong revenue growth, significant product upgrades, and successful cost reductions, indicating a positive trajectory for Guardant Health. However, litigation expenses and challenges with NCCN guidelines presented some obstacles. Overall, the positive developments outweighed the lowlights.Highlights
Record Revenue Growth
Q4 2024 revenue grew 30% year-over-year to $202 million, bringing total full year revenue to $739 million, an increase of 31% year-over-year.
Clinical Revenue and Volume Surge
Clinical revenue grew 34% year-over-year, with total oncology clinical volumes increasing 24% in Q4 and 20% for the full year.
Major Product Upgrades
Guardant360 Test upgraded to the Smart Liquid Biopsy platform, expanding genomic markers and improving detection sensitivity by a factor of 10.
Significant ASP Improvement
Guardant360 ASP increased from $2,750 to $3,000, achieving a target four years ahead of schedule due to reimbursement wins.
Shield FDA Approval and Medicare Coverage
Shield became the first FDA-approved and Medicare-covered blood test for CRC screening, with a Medicare price of $920 and potential increase to $1,495.
Cost Reductions and Financial Health
Reveal achieved more than 50% reduction in COGS, and the company ended the year with approximately $944 million in cash, expecting cash flow break-even by 2028.
Lowlights
Litigation Expenses Impact
Significant litigation expenses related to a false advertising trial affected non-GAAP operating expenses, which exceeded guidance.
NCCN Guidelines Concerns
NCCN recommended against surveillance, posing challenges for the adoption of Reveal.
Shield Sales Force Expansion Challenges
Sales force expansion is back-end loaded due to late hiring, affecting the timeline for productivity contributions.
Company Guidance
During the Guardant Health Q4 2024 earnings call, management provided guidance indicating a strong year ahead. The company expects total revenue for 2025 to range between $850 million and $860 million, representing a 15% to 16% growth compared to 2024. This guidance excludes a $22 million non-recurring out-of-period revenue upside in 2024, implying an adjusted growth of 19% to 20%. Oncology revenue is forecasted to grow approximately 15% year-over-year, excluding the non-recurring upside, with clinical volume growth expected at around 25%. The biopharma and data segment is anticipated to see low double-digit growth, while screening revenue from Shield is projected between $25 million and $30 million, driven by 45,000 to 50,000 tests. The company also plans for full-year non-GAAP gross margins of 62% to 63% and aims to reduce free cash flow burn to between $225 million and $235 million, with a focus on maintaining their screening cash burn at approximately $200 million.Guardant Health Corporate Events
Business Operations and StrategyFinancial Disclosures
Guardant Health Reports Revenue Growth Amid Cash Flow Losses
Neutral
Jan 13, 2025
Guardant Health announced its preliminary, unaudited results for the fourth quarter and full year 2024, reporting a 31% increase in annual revenue driven by strong clinical and biopharma sales. Despite this growth, the company reported a negative free cash flow of $275 million for the full year and cited its strategic focus on expanding its commercial infrastructure following the successful launch of the Shield test, positioning itself for continued growth in the oncology sector.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.