NEW YORK (TheStreet) -- Shares of Exact Sciences Corp. (EXAS) are gaining 1.63% to $29.93 after Canaccord raised its 2015 earnings estimates to $1.63 from $1.55, with 2016 earnings estimates increased to $1.09 from $0.99.
Exact Sciences is a molecular diagnostics company focused on the early detection and prevention of colorectal cancer, and has developed a non-invasive screening test called Cologuard.
Exact Sciences is building strong momentum commercializing Cologuard, as evidenced by its raising second quarter volume guidance and achieving a surprisingly strong 73% patient compliance rate, Canaccord noted.
"Longer term, we think Exact Sciences could achieve patient compliance in the mid-70s and as high as 80%," Canaccord analysts said.
Exact Sciences has a good opportunity to scale into a diversified cancer diagnostics company with multiple test offerings in 2020, Canaccord added.
The firm maintained its "buy" rating and a price target of $32 on the stock.
Separately, TheStreet Ratings team rates EXACT SCIENCES CORP as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:
"We rate EXACT SCIENCES CORP (EXAS) a SELL. This is driven by a number of negative factors, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity, weak operating cash flow and poor profit margins."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- EXACT SCIENCES CORP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. Earnings per share have declined over the last two years. We anticipate that this should continue in the coming year. During the past fiscal year, EXACT SCIENCES CORP reported poor results of -$1.24 versus -$0.69 in the prior year. For the next year, the market is expecting a contraction of 40.3% in earnings (-$1.74 versus -$1.24).
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Biotechnology industry. The net income has significantly decreased by 122.3% when compared to the same quarter one year ago, falling from -$16.11 million to -$35.80 million.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Biotechnology industry and the overall market, EXACT SCIENCES CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- Net operating cash flow has significantly decreased to -$34.50 million or 179.33% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- The gross profit margin for EXACT SCIENCES CORP is rather low; currently it is at 17.67%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, EXAS's net profit margin of -839.21% significantly underperformed when compared to the industry average.
- You can view the full analysis from the report here: EXAS Ratings Report