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GeneDx Holdings (WGS)
NASDAQ:WGS
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GeneDx Holdings (WGS) AI Stock Analysis

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WGS

GeneDx Holdings

(NASDAQ:WGS)

Rating:69Neutral
Price Target:
$138.00
▲(4.12% Upside)
GeneDx Holdings' overall score is driven by strong financial performance and positive earnings call sentiment, indicating operational improvements and growth potential. However, the high P/E ratio suggests overvaluation, and technical indicators point to overbought conditions, which could limit upside potential.
Positive Factors
Earnings and revenue growth
The outlook now calls for substantial revenue growth in a market that is still largely untapped, making an attractive investment case.
Market opportunity
New guidelines from the AAP now recommend exome/genome as a first-line test for kids with development delay & intellectual disability, opening a big opportunity for WGS to access general pediatricians.
Product innovation
The ultra-rapid genome was launched, offering a fast turnaround time and competitive pricing, which may help take volumes from smaller competitors.
Negative Factors
Stock performance
While Q1 exome/genome revenue grew 62% Y/Y, the stock sold off by >50% due to perceived sequential slowdown.
Volume estimates
Lowering volume estimates for Q2 and Q3 by 1% due to caution after a volume miss in Q1.

GeneDx Holdings (WGS) vs. SPDR S&P 500 ETF (SPY)

GeneDx Holdings Business Overview & Revenue Model

Company DescriptionGeneDx Holdings Corp. is a patient centered health intelligence company. It engages in transforming healthcare by applying AI and machine learning to multidimensional, longitudinal clinical and genomic data to build dynamic models of human health and defining optimal, individualized health trajectories. The firm, through its Centrellis health intelligence platform, generates a more complete understanding of disease and wellness and provides science-driven solutions to the most pressing medical needs. The company was founded by Eric Schadt in October 2015 and is headquartered in Stamford, CT.
How the Company Makes MoneyGeneDx Holdings generates revenue through a diversified model primarily centered around its genetic testing services. The company charges fees for its sequencing services, which are utilized by hospitals, clinics, and research institutions. Its revenue streams include payments from healthcare providers who order genetic tests for their patients, as well as research collaborations with pharmaceutical companies and academic institutions. Additionally, GeneDx may receive funding from partnerships aimed at developing new genomic technologies and solutions. The company benefits from the growing demand for precision medicine, which drives the need for accurate and comprehensive genetic testing, further contributing to its financial performance.

GeneDx Holdings Earnings Call Summary

Earnings Call Date:Jul 29, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Nov 17, 2025
Earnings Call Sentiment Positive
The earnings call reflects a strong positive sentiment with significant revenue growth, record high margins, and successful integration into new markets like NICU. However, challenges remain in expanding into the general pediatrics market and gaining broader payer coverage.
Q2-2025 Updates
Positive Updates
Record Revenue Achievement
GeneDx achieved over $100 million in revenue for the first time in a single quarter, with second quarter revenues of $102.7 million, a 49% increase year-over-year.
Exome and Genome Revenue Surge
Revenue from exome and genome testing reached a record high of $85.9 million, up 69% from the same quarter last year.
Strong Gross Margin
The company expanded its adjusted gross margin to a record high of 71%, driven by a favorable mix shift, improved reimbursement, and lower costs.
Pediatric Neurologist Market Success
Pediatric neurologists made up a majority of new ordering providers, capturing nearly 1/3 of the target clinicians in this segment.
NICU Market Opportunity
The NICU represents a $1 billion market opportunity, with 42 out of 50 top NICUs having ordered testing from GeneDx this year.
Guidance Increase
Raised full-year revenue guidance to between $400 million and $415 million, with an expectation of at least 30% year-over-year volume growth.
Negative Updates
General Pediatrics Market Challenges
While the general pediatrics market represents a significant future opportunity, contribution to this year is expected to be minimal as the company focuses on building awareness and adoption.
Dependency on Pediatric Neurologists
A significant portion of Q2 volume growth was still reliant on existing pediatric neurologists, indicating a need to expand into new indications and markets.
Payer Coverage Limitations
While progress has been made, challenges remain in expanding Medicaid coverage, with only 35 states covering exome and genome testing on an outpatient basis.
Company Guidance
During GeneDx's second quarter 2025 earnings call, the company provided updated guidance, highlighting a strong performance with record revenues of $102.7 million, marking a 49% increase year-over-year. The exome and genome segment contributed $85.9 million, up 69% from the previous year. The average reimbursement rate for these tests was over $3,700, an increase from $3,400 last quarter. GeneDx raised its full-year 2025 revenue guidance to between $400 million and $415 million, with expectations for exome and genome revenue growth of 48% to 52%. They also reaffirmed a full-year adjusted gross margin guidance of 68% to 71% and a commitment to remain profitable each quarter. The company emphasized its expanding market share, particularly in pediatric neurology, and the promising potential in the NICU and general pediatrics markets, bolstered by new American Academy of Pediatrics guidelines.

GeneDx Holdings Financial Statement Overview

Summary
GeneDx Holdings shows positive revenue growth and operational improvements, with a strong gross profit margin and positive free cash flow. However, limited profitability and historical cash flow challenges remain concerns.
Income Statement
72
Positive
GeneDx Holdings shows positive revenue growth with a significant increase in total revenue from previous years. The Gross Profit Margin for TTM (Trailing-Twelve-Months) is strong at 67.2%, reflecting efficient management of production costs. However, the Net Profit Margin is modest at 0.39%, indicating limited profitability. The company turned its EBIT and EBITDA positive, signaling potential operational improvements.
Balance Sheet
65
Positive
The company maintains a reasonable Debt-to-Equity Ratio of 0.23, showcasing a conservative leverage approach. A robust Equity Ratio of 59.74% suggests strong capital structure stability. The Return on Equity (ROE) is low at 0.51%, reflecting limited returns on shareholders' equity.
Cash Flow
68
Positive
GeneDx Holdings achieved positive Free Cash Flow in the TTM, indicating improved cash generation capabilities. The Operating Cash Flow to Net Income Ratio is strong at 17.17, highlighting efficient cash operations compared to net income. However, historical challenges in maintaining positive cash flows remain a concern.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue362.32M305.45M202.57M234.69M212.19M179.32M
Gross Profit243.41M194.40M60.62M-26.75M-16.60M4.03M
EBITDA22.84M-27.64M-136.46M-398.20M-219.19M-224.73M
Net Income1.41M-52.29M-175.77M-548.98M-245.39M-241.34M
Balance Sheet
Total Assets463.86M419.38M473.67M490.94M554.09M251.64M
Cash, Cash Equivalents and Short-Term Investments134.56M141.19M130.15M123.93M400.57M108.13M
Total Debt62.70M116.17M119.77M77.13M11.00M45.02M
Total Liabilities186.73M174.13M245.66M237.24M165.99M581.69M
Stockholders Equity277.13M245.25M228.02M253.71M388.10M-330.05M
Cash Flow
Free Cash Flow5.81M-33.99M-185.86M-333.48M-211.22M-125.10M
Operating Cash Flow24.13M-28.50M-180.15M-319.15M-190.43M-93.13M
Investing Cash Flow-54.03M-30.13M-43.73M-141.33M-20.79M-31.97M
Financing Cash Flow59.05M44.16M186.24M197.31M493.73M129.06M

GeneDx Holdings Technical Analysis

Technical Analysis Sentiment
Positive
Last Price132.54
Price Trends
50DMA
103.37
Positive
100DMA
89.76
Positive
200DMA
86.63
Positive
Market Momentum
MACD
8.13
Positive
RSI
70.44
Negative
STOCH
75.06
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WGS, the sentiment is Positive. The current price of 132.54 is above the 20-day moving average (MA) of 123.73, above the 50-day MA of 103.37, and above the 200-day MA of 86.63, indicating a bullish trend. The MACD of 8.13 indicates Positive momentum. The RSI at 70.44 is Negative, neither overbought nor oversold. The STOCH value of 75.06 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for WGS.

GeneDx Holdings Risk Analysis

GeneDx Holdings disclosed 75 risk factors in its most recent earnings report. GeneDx Holdings 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

GeneDx Holdings Peers Comparison

Overall Rating
UnderperformOutperform
Sector (51)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
74
Outperform
$2.03B38.2910.94%9.62%-6.61%
69
Neutral
$3.81B7,087.700.60%48.70%
66
Neutral
$1.39B43.105.27%3.20%
52
Neutral
$569.93M-64.27%-5.24%23.59%
51
Neutral
$7.95B-0.40-41.67%2.21%22.29%-1.85%
51
Neutral
$218.96M-74.09%7.31%-7.49%
50
Neutral
$1.40B-44.40%18.59%10.96%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
WGS
GeneDx Holdings
132.54
98.81
292.94%
PGNY
Progyny
22.55
-0.99
-4.21%
SDGR
Schrodinger
19.13
-0.95
-4.73%
GDRX
GoodRx Holdings
4.00
-3.82
-48.85%
SOPH
SOPHiA GENETICS
3.24
-0.45
-12.20%
DH
Definitive Healthcare Corp
4.00
-0.29
-6.76%

GeneDx Holdings Corporate Events

Executive/Board ChangesShareholder Meetings
GeneDx Holdings Approves Key Proposals at Annual Meeting
Neutral
Jun 18, 2025

On June 18, 2025, GeneDx Holdings Corp. held its Annual Meeting of Stockholders, where key proposals were voted on and approved. The stockholders elected two Class I directors, Eli D. Casdin and Joshua Ruch, to serve three-year terms, and ratified the appointment of Ernst & Young LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2025.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.Date of analysis: Aug 19, 2025