Cancer Genetics, Inc. is an emerging leader in enabling precision medicine for oncology through the use of molecular markers and information. CGIX’s tests, which target difficult to diagnose hematological, urogenital and HPV-associated cancers, are designed to guide prognosis and treatment with the goal of improving outcomes for patients. CGIX is developing a global footprint with locations in the US, India and China. It has established strong clinical research collaborations with major cancer centers such as Memorial Sloan Kettering, The Cleveland Clinic, Mayo Clinic, Keck School of Medicine at USC and the National Cancer Institute, and its state-of-the-art reference labs are CLIA-certified and CAP-accredited with licensure from several states including New York State..
CGIX is significantly undervalued relative to its peers. Wall Street analysts give the stock a buy rating with consensus price target of $5.88 per share. The company continues to build its backlog of biopharma contracts, which stand at $40 million as of the most recently reported period. Revenue was up 50% YoY in FY16 and new partnerships, such as Mendel AI and Lantern Pharma, which leverage big data and artificial intelligence, should pave the way for further revenue acceleration. With tight cost controls and margin improvements, CGIX is on a clear path to near-term profitability.
FY16 revenue increased to $27 million, up 50% YoY from $18 million in FY15
- Quarter-over-quarter revenue was up 34% to $7.2 million in 4Q16
- Biopharma services revenue increased to $15.3 million, up 32% YOY; Expected to drive revenue growth in FY17
- Wall Street analysts are projecting revenue to grow to $68.3 million in 2018, approximately doubling 2016 revenue.
Gross margin improvement and operating expense reduction moving CGIX towards profitability
- 4Q16 gross profit margins were 41%, up from 13% in 4Q15
- FY16 gross profit margins were 37%, up from 22% in FY15
- Operating expenses have fallen to $6.5 million in 4Q16, down from $7.9 million in 4Q15
CGIX is working with 9 of the top 10 global pharmaceutical and biotech companies
- The Company is powering over 125 active clinical trials and studies with 36 focused in immuno-oncology
- The company continues to build its backlog of biopharma contracts, which stand at $40 million as of the most recently reported period
- The Company announced strategic agreements with Mendel AI and Lantern Pharma Inc. to jointly leverage genomics, biomarkers & artificial intelligence (AI) to rescue and repurpose drugs for cancer
- Integrating AI, big data, and combining genomic and immune –market testing should accelerate the company’s discovery of new therapeutics
- Company has collaborations with leading cancer institutions including Mayo Clinic and has 90 patents globally
- CGIX closed $12 million debt refinancing and also raised an additional $1 million in non-dilutive capital in 1Q17