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Veracyte (VCYT)
NASDAQ:VCYT
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Veracyte
(NASDAQ:VCYT)
71Outperform
Positive Factors
Financial Performance
Total revenues were ahead of consensus at $114M, and management increased expected EBITDA margins, underscoring commitment to profitable growth.
Market Expansion
The announcement of launching Prosigna as an LDT in the United States by mid-2026 indicates strategic expansion and potential growth.
Product Development
VCYT has built strong clinical evidence that fuels adoption of its core Decipher (prostate) and Afirma (thyroid) tests, and is working to build their pipeline of assays.
Negative Factors
Market Competition
Prosigna LDT launch promising but enters a competitive market.
Operational Challenges
The strategic review of the French subsidiary could potentially delay IVD timelines.
Revenue Decline
Product revenue experienced a year-over-year decline of 18%, impacted by ongoing supply chain issues affecting Prosigna nCounter.
Veracyte (VCYT) vs. S&P 500 (SPY)
Market Cap
$2.27B
Dividend YieldN/A
Average Volume (3M)1.11M
Price to Earnings (P/E)68.7
Beta (1Y)1.63
Revenue Growth23.42%
EPS GrowthN/A
CountryUS
Employees824
SectorHealthcare
Sector Strength43
IndustryBiotechnology
Share Statistics
EPS (TTM)0.09
Shares Outstanding78,314,610
10 Day Avg. Volume1,270,284
30 Day Avg. Volume1,114,881
Financial Highlights & Ratios
PEG Ratio2.00
Price to Book (P/B)1.91
Price to Sales (P/S)0.00
P/FCF Ratio29.14
Enterprise Value/Market Cap0.95
Enterprise Value/Revenue1.24
Enterprise Value/Gross Profit6.87
Enterprise Value/Ebitda27.22
Forecast
1Y Price Target
$39.67Price Target Upside37.70% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
Veracyte Business Overview & Revenue Model
Company DescriptionVeracyte, 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 MoneyVeracyte generates revenue through the sale of its proprietary genomic tests to healthcare providers and institutions. The company's revenue model is primarily based on test volume, with healthcare providers ordering tests for patients who require more precise diagnostic information. Veracyte also partners with pharmaceutical companies and research institutions to provide data and insights derived from its genomic technologies, further contributing to its revenue streams. Additionally, Veracyte may receive reimbursement from insurance companies and government healthcare programs for its diagnostic tests, making these partnerships and reimbursement arrangements significant factors in its earnings.
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.85
Very Positive
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.78
Positive
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.82
Very Positive
| 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 | EBIT |
| 23.80M | 16.14M | -85.80M | -41.08M | -81.90M | -35.39M | EBITDA |
| 50.09M | 49.20M | -49.41M | -6.98M | -60.18M | -25.77M | Net Income Common Stockholders |
| 33.05M | 24.14M | -74.40M | -36.56M | -75.56M | -35.85M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 287.36M | 289.44M | 216.45M | 178.85M | 173.20M | 349.36M | Total Assets |
| 1.32B | 1.30B | 1.11B | 1.16B | 1.19B | 457.16M | Total Debt |
| 50.50M | 50.74M | 12.63M | 14.72M | 18.85M | 12.32M | Net Debt |
| -135.62M | -188.35M | -203.82M | -139.53M | -154.34M | -337.05M | 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
Negative
28.81
Price Trends
30.73
Negative
35.54
Negative
35.25
Negative
Market Momentum
-0.70
Positive
41.46
Neutral
34.51
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VCYT, the sentiment is Negative. The current price of 28.81 is below the 20-day moving average (MA) of 30.36, below the 50-day MA of 30.73, and below the 200-day MA of 35.25, indicating a bearish trend. The MACD of -0.70 indicates Positive momentum. The RSI at 41.46 is Neutral, neither overbought nor oversold. The STOCH value of 34.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for VCYT.
Veracyte Risk Analysis
Veracyte disclosed 57 risk factors in its most recent earnings report. Veracyte 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
Veracyte Peers Comparison
Overall Rating
UnderperformOutperform
Sector (52)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $2.27B | 68.68 | 2.86% | ― | 23.42% | ― | |
71 Outperform | $2.14B | 1,101.77 | 1.13% | ― | 14.80% | 530.21% | |
57 Neutral | $971.38M | ― | -36.26% | ― | 127.33% | 21.31% | |
52 Neutral | $5.19B | 3.04 | -44.20% | 2.82% | 16.59% | -0.39% | |
48 Neutral | $2.37B | ― | -31.60% | ― | ― | -10.19% | |
45 Neutral | $2.50B | ― | -74.17% | ― | ― | -43.10% | |
41 Neutral | $2.52B | ― | -30.57% | ― | ― | -147.80% |
* Healthcare Sector Average
Performance Comparison
VCYT
Veracyte
28.81
7.19
33.26%
VCEL
Vericel
43.52
-6.81
-13.53%
ARDX
Ardelyx
3.99
-3.83
-48.98%
XENE
Xenon
31.43
-7.37
-18.99%
IMVT
Immunovant
15.00
-14.56
-49.26%
MLTX
MoonLake Immunotherapeutics
40.28
0.37
0.93%
Veracyte Earnings Call Summary
Earnings Call Date:May 07, 2025
(Q1-2025)
| % Change Since: -6.58%|
Next Earnings Date:Jul 30, 2025
Earnings Call Sentiment Positive
The earnings call indicates a strong performance with significant revenue growth, particularly in the Decipher and Afirma tests, and positive developments in upcoming product launches. However, challenges with the SAS subsidiary and some revenue impacts due to prior period collections and tariffs present potential hurdles.Q1-2025 Updates
Positive Updates
Strong Revenue Growth
Veracyte reported Q1 2025 revenue of $114.5 million, an 18% year-over-year increase, driven by testing revenue growth of 19%.
Decipher's Impressive Performance
Decipher volume grew 37% year-over-year with revenue growth of 33%. The test is now expanding into the metastatic prostate cancer market.
Afirma Volume Growth
Afirma saw a 10% increase in test volume year-over-year, indicating strong demand and market penetration.
Positive Adjusted EBITDA Margin
The company achieved an adjusted EBITDA margin of 21.6%, exceeding expectations.
Advancement in New Product Launches
Veracyte is set to launch Prosigna as an LDT for the U.S. breast cancer market and progressing with its MRD platform for muscle invasive bladder cancer, aiming for a 2026 launch.
Negative Updates
Challenges with SAS Subsidiary
Veracyte's French subsidiary, SAS, filed for bankruptcy, impacting IVD product development timelines.
Afirma Revenue Impacted by Prior Period Collections
Afirma's revenue growth was lower than volume growth due to prior period collection benefits in 2024 and issues with lab benefit managers' policies.
Uncertainty in Tariff Impacts
Potential tariff impacts on the supply chain could affect costs, though measures are in place to mitigate this.
Company Guidance
In the recent Q1 2025 financial results call, Veracyte provided guidance that highlighted several key metrics and strategic initiatives. The company reported total revenue of $114.5 million, marking an 18% year-over-year increase. Testing revenue grew 19% year-over-year, with double-digit volume growth in their Decipher and Afirma tests, at 37% and 10%, respectively. The adjusted EBITDA margin was 21.6%, surpassing expectations, and the company ended the quarter with $287 million in cash and short-term investments. For 2025, Veracyte reiterated its testing revenue guidance of $470-480 million and raised its adjusted EBITDA margin guidance to 22.5% from 21.6%. The company is focused on expanding its testing portfolio, including the launch of Decipher Prostate for metastatic populations and a new Prosigna LDT for the U.S. breast cancer market. They also emphasized progress in their MRD platform, targeting a commercial launch in the first half of 2026, and highlighted their commitment to international expansion despite operational changes in their French subsidiary.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.