Veracyte (VCYT) AI Stock Analysis

• Market Cap: $2.15B
• Dividend Yield: N/A
• Average Volume (3M): 961.25K
• Price to Earnings (P/E): 65.6
• Beta (1Y): 1.65
• Revenue Growth: 23.42%
• EPS Growth: N/A
• Country: US
• Employees: 824
• Sector: Healthcare
• Sector Strength: 39
• Industry: Biotechnology
• EPS (TTM): 0.09
• Shares Outstanding: 78,314,610
• 10 Day Avg. Volume: 1,147,676
• 30 Day Avg. Volume: 961,251
• PEG Ratio: 0.86
• Price to Book (P/B): 1.58
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -1.67K
• Enterprise Value/Market Cap: 0.72
• Enterprise Value/Revenue: 0.90
• Enterprise Value/Gross Profit: 4.98
• Enterprise Value/Ebitda: 19.72
• 1Y Price Target: $39.67
• Price Target Upside: 44.20% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 8

• Rating: 71 Outperform
• Price Target: $32.00 ▲(16.32%Upside)

Veracyte's overall stock score reflects strong financial performance and positive earnings call sentiment, suggesting potential growth. However, technical indicators reveal bearish momentum, and high valuation levels pose a risk. Despite these challenges, Veracyte's strategic initiatives and robust financials position it well for future opportunities.

Positive Factors

Financial Performance

Total revenues were ahead of consensus at $114M, and management increased expected EBITDA margins, underscoring commitment to profitable growth.

Market Position

Decipher's dominant market position is underlined by management's estimate of a 65% share in a 40% penetrated market.

Negative Factors

Strategic Challenges

The strategic review of the French subsidiary could potentially delay IVD timelines.

Supply Chain Issues

Product revenue experienced a year-over-year decline of 18%, impacted by ongoing supply chain issues affecting Prosigna nCounter.

Veracyte Business Overview & Revenue Model

Company Description

Veracyte, Inc. operates as a diagnostics company worldwide. The company offers Afirma Genomic Sequencing Classifier and Xpression Atlas, which are used to determine patients with indeterminate results are benign to avoid unnecessary surgery; Decipher Prostate Biopsy and Radical Prostatectomy for prostate cancer diagnosis; Prosigna Breast Cancer Assay for breast cancer diagnosis; Percepta Genomic Sequencing Classifier and Percepta Nasal Swab Test for lung cancer diagnosis; Envisia Genomic Classifier for diagnosing interstitial lung disease, including idiopathic pulmonary fibrosis; and Immunoscore Colon Cancer test for colon cancer diagnosis. It is also developing Percepta Genomic Atlas to help inform lung cancer treatment decisions; Envisia Classifier, the nCounter analysis system; and LymphMark for lymphoma subtyping test. Veracyte, Inc. has technology licensing and collaboration arrangements with Johnson & Johnson; Acerta Pharma; and CareDx. The company was formerly known as Calderome, Inc. and changed its name to Veracyte, Inc. in March 2008. Veracyte, Inc. was incorporated in 2006 and is headquartered in South San Francisco, California.

How the Company Makes Money

Veracyte makes money through the sale of its genomic diagnostic tests, which are primarily marketed to healthcare providers, including hospitals and clinics. The company generates revenue from both direct sales of its diagnostic tests and through partnerships with laboratories and other healthcare entities that utilize its testing solutions. Veracyte's key revenue streams include its Afirma, Percepta, Envisia, and Decipher product lines, each targeting specific types of cancer and lung diseases. Additionally, strategic collaborations and licensing agreements with pharmaceutical companies and research institutions help bolster its earnings by integrating its genomic insights into broader clinical studies and drug development processes. Insurance reimbursements and agreements with health plans also play a crucial role in Veracyte's revenue model, ensuring that its tests are accessible and covered for patients.

Veracyte Financial Statement Overview

Summary

Veracyte demonstrates solid financial performance with strong revenue and profit growth, improved margins, and robust cash flow. The company's low debt enhances its financial stability, though ROE remains modest. Overall, Veracyte is well-positioned to leverage financial strengths for future opportunities.

Income Statement

Veracyte has shown significant improvement in its financial performance over the years. The Gross Profit Margin for TTM (Trailing-Twelve-Months) is approximately 67.6%, indicating strong cost management. The Net Profit Margin stands at 7.1%, highlighting a positive move from previous losses. Revenue growth is strong, with a 27.9% increase from 2023 to 2024 and a 39.1% increase from 2022 to 2023, indicating robust growth momentum. The EBIT and EBITDA margins have turned positive, showing improved operational efficiency.

Balance Sheet

The company's balance sheet shows a healthy financial position with a strong Equity Ratio of approximately 90.8% for TTM, indicating a low reliance on debt. The Debt-to-Equity Ratio is favorable at 0.04, reflecting low leverage. Return on Equity (ROE) is approximately 2.8%, which is modest but a significant improvement from previous periods of negative ROE. The overall stability is evident, although the company could improve its ROE to enhance shareholder value.

Cash Flow

Veracyte's cash flow statements reveal strong cash generation capabilities. The Free Cash Flow for TTM has grown by 22.9% from the previous year, showcasing efficient capital management. The Operating Cash Flow to Net Income Ratio is 2.7, indicating good cash conversion. The Free Cash Flow to Net Income Ratio of 2.4 suggests strong cash flow relative to net income, providing a cushion for future investments and debt servicing.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	463.39M	445.76M	361.05M	296.54M	219.51M	117.48M
Gross Profit	313.06M	298.14M	248.15M	194.95M	145.11M	76.03M
EBITDA	50.09M	49.20M	-49.41M	-6.98M	-60.18M	-25.77M
Net Income	33.05M	24.14M	-74.40M	-36.56M	-75.56M	-35.85M
Balance Sheet
Total Assets	1.32B	1.30B	1.11B	1.16B	1.19B	457.16M
Cash, Cash Equivalents and Short-Term Investments	287.36M	289.44M	216.45M	178.85M	173.20M	349.36M
Total Debt	50.50M	50.74M	12.63M	14.72M	18.85M	12.32M
Total Liabilities	120.47M	124.07M	70.80M	81.22M	91.31M	35.93M
Stockholders Equity	1.19B	1.18B	1.04B	1.08B	1.10B	421.23M
Cash Flow
Free Cash Flow	78.45M	63.81M	34.26M	-1.01M	-37.00M	-12.55M
Operating Cash Flow	89.42M	75.10M	44.22M	7.54M	-31.62M	-9.71M
Investing Cash Flow	-110.97M	-56.27M	15.11M	-29.39M	-739.21M	-3.84M
Financing Cash Flow	-716.00K	4.90M	2.84M	3.49M	596.32M	203.59M

Veracyte Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 27.51
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VCYT, the sentiment is Neutral. The current price of 27.51 is above the 20-day moving average (MA) of 27.08, below the 50-day MA of 28.39, and below the 200-day MA of 34.81, indicating a neutral trend. The MACD of -0.24 indicates Negative momentum. The RSI at 50.86 is Neutral, neither overbought nor oversold. The STOCH value of 82.22 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for VCYT.

Veracyte Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VCYT	71 Outperform	$2.15B	65.58	2.86%	―	23.42%	―
ARDX	62 Neutral	$1.02B	―	-36.26%	―	127.33%	21.31%
VCEL	59 Neutral	$2.10B	1,056.71	1.13%	―	14.80%	530.21%
Sector *	52 Neutral	$7.53B	0.32	-61.76%	2.28%	16.60%	1.56%
XENE	48 Neutral	$2.55B	―	-31.60%	―	―	-10.19%
IMVT	45 Neutral	$2.90B	―	-62.46%	―	―	-43.10%
MLTX	41 Neutral	$3.14B	―	-30.57%	―	―	-147.80%

Veracyte Corporate Events

Veracyte Stockholders Approve Key Decisions at Annual Meeting

Veracyte‘s stockholders convened for their Annual Meeting, where they elected seven directors to serve until the 2026 annual meeting. Additionally, they ratified Ernst & Young LLP as the independent registered public accounting firm for 2025 and approved the compensation of the company’s named executive officers on a non-binding advisory basis. Stockholders also decided that future advisory votes on executive compensation will occur annually, aligning with the company’s recommendation. Furthermore, the 2023 Plan Amendment received approval.

The most recent analyst rating on (VCYT) stock is a Buy with a $37.00 price target. To see the full list of analyst forecasts on Veracyte stock, see the VCYT Stock Forecast page.