oski003 said:
DiabloWags said:
I have owned shares in Exact Sciences (EXAS) going back to 2009.
At one point, I held 83,000 shares in single digits.
Still hold 26,000 shares.
The CEO is one of the brightest in the business.
I remember when he was brought in to lead the company in 2009 when it only had 5 employees left and nothing but some IP and an idea from a noted gastroenterologist from the Mayo Clinic, Dr. David Ahlquist. It now has 6500 employees and a 1,350 member commercial team with 500 people in R&D. Delivered 4 million+ Cologuard tests in 2023.
This blood test will not topple the performance of Cologuard, their stool DNA test for colon cancer.
Cologuard has superior Stage 1 and Stage 2 sensitivity as well as pre-cancer sensitivity.
This blood test is for those who are unwilling to undergo colonoscopy or use Cologuard on a once every 3 year screening interval. Cologuard is currently fully reimbursed by commercial payors and of course free with Medicare with no co-pay per the ACA.
The data announced was merely a "sample" of a much larger pivotal clinical study.
This data was used to lock down the CRC test algorithm.
As a result, it was a quasi-case-control study that included prospectively collected "normals" (no findings or non-advanced polyps) from their BLUE-C pivotal trial, advanced precancerous lesions (60% prospectively collected), and enriched fully for cancers (n=-60).
The "prospective" collection dynamic in this data should add a bit of confidence heading into the readout of the pivotal clinical trial - - - namely that degradation won't be as dramatic as usually is the case in a prospective clinical trial vs a case controlled study.
Pivotal study results are due in the first half of 2025.
The bar for CMS reimbursement will be CRC sensitivity of 74% and a specificity of 90%.
Colon Cancer is the leading cause of cancer death in Men < 50.
In 2018, the American Cancer Society lowered the recommended age to start screening for CRC from age 50 to 45.
Get Screened!
EXAS is down to $50 pps. It was $70 pps at the time you revealed you held thousands of shares. Will it recover?
I bought the stock in 2009 in low single digits after a new CEO came in by the name of Kevin Conroy.
This was when Cologuard was nothing more than a "lab" test in a petri-dish. It was a long, long way from undergoing a validation study let alone FDA approval and covered by CMS, let alone the US Preventative Services Task Force (USPSTF) which controls any screening guidelines that impact primary care.
At one point, I owned 83,000 shares at an average cost of $8.75 and I was the reason that Andrew Bary of Barron's wrote a feature article on the company in Barron's back in October of 2012. The stock had been very volatile (up until now) and at one point traded as high as $150.
Exact Sciences Colon-Cancer Test Could Find Big Market - Barron'sI still own 26,000 shares.
They "missed" their numbers for Q3 last year and that spills into a Q4 overhang given that Q4 is the weakest of all their quarters due to the Holidays.
Q4 was already pre-announced at the start of the JP Morgan Healthcare Conference in early January, (as they do every year) so today's earnings will not be "news".
They expect $713 million in revenue ((+10% y/y) and screening revenue (Cologuard) of $553 million (14% y/y).
The teens growth in Cologuard achieved in the last 3 quarters is encouraging, and the re-screen population (once every 3 years), as does the lowering of the screening age by the American Cancer Society to 45 from 50 - - - all should give them more of a "tailwind" in 2025. They also recently received a price increase from CMS.
But again, these topline numbers were announced back in January and won't be viewed as any material "news". Any competitor fears are totally overblown in my mind, given the rigorous regulatory and commercialization hurdles in the DX space.
That having been said, analysts and investors will be focusing on management's comments about re-accelerating Cologuard screening growth in 2025 to at least 15% as well as the launch of several new cancer screening products and even data on a blood-based colon cancer test and a multiple cancer early detection test (MCED). - - - But the latter is a very long road.
The stock is fighting negative momentum cast upon the entire Diagnostics sector (given Trump's NIH cuts and other FDA/SCOTUS regulatory issues over LDT's and reimbursement of a guideline included test). Just look at the charts of ILMN, TXG, and PACB to get an idea of how this sector has been torn a part.. NTRA is the lone exception. Poor investor sentiment is hard to fight and I would imagine it will take a couple of quarters for EXAS to regain positive investor sentiment.
In a nutshell, if one assumes low double-digit Cologuard volume growth from 2024 - 2027, including AEBITDA margins of 20%+, the stock can get back to $80 for the BASE case. The BULL case would be over $90. And I would say the BEAR case would be $40 which would imply only 2x price/sales.
I would encourage anyone interested in the stock to listen to today's earnings call after the close.
That's if they have more than 2-minutes to spare.
You're welcome.
