EGE Initiates CombiMatrix (CBMX) with a Buy, May Sell Itself In the Future

August 19, 2008 7:58 AM EDT

Emerging Growth Equities initiates coverage on CombiMatrix (NASDAQ: CBMX) with a Buy rating and an $18 price target.

The firm said, "Initially, CombiMatrix intends to commercially validate its diagnostics by demonstrating that it can achieve a beachhead of early sales. Once CombiMatrix has validated its commercial relevance with annualized diagnostic Services sales of $5m-$10m, we anticipate the Company will be in a good position to decide whether it will continue independently or sell itself. We believe the Company may command a much higher price once it has demonstrated initial commercial acceptance and adoption of its diagnostics. We anticipate that interested buyers could include laboratories such as Quest (NYSE: DGX), LabCorp (NYSE: LH) and Genoptix (Nasdaq: GXDX), or diagnostics and equipment suppliers such as Illumina (Nasdaq: ILMN), Affymetrix (Nasdaq: AFFX), Invitrogen/Applied BioSystems (Nasdaq: IVGN), and Roche."

CombiMatrix Corporation offers technologies, products, and services in the areas of drug development, genetic analysis, molecular diagnostics, nanotechnology research, defense, and homeland security.

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