Canaccord Genuity on Life Sciences/Biomedical Devices and Services: 2012 Best Ideas: OraSure (OSUR) and Cepheid (CPHD)
OSUR Hot Sheet
Rating Summary:6 Buy, 0 Hold, 0 Sell
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Today's Overall Ratings:
Up: 19 | Down: 16 | New: 82
Canaccord Genuity on Life Sciences/Biomedical Devices and Services: 2012 best ideas: OraSure and Cepheid - Best ideas for small- and mid-cap investors by Jeffrey Frelick
On Frelick's small-cap pick, OraSure Technologies (Nasdaq: OSUR)(Buy-rated): "OraSure is embarking on two new incremental revenue opportunities that provide high value and improve clinical outcomes...OSUR recently received a CLIA waiver for its HCV rapid test, which opens up its marketing reach to 180,000 CLIA-waived sites and will be detailed by the Merck (NYSE: MRK) sales force. We anticipate a revision to HCV testing guidelines in the spring following the BEST-C study."
Mid-Cap Pick, Cepheid (Nasdaq: CPHD)(Buy-rated): "Our channel checks reveal that CPHD customers consistently cite labor savings and the broad test menu as keys to GeneXpert adoption. The GeneXpert system is easy to use and does not require additional personnel to operate. The platform has 11 FDA-approved tests, and CPHD expects to add another two tests in 2012 and another 10 by the end of 2014. CPHD expects to maintain its R&D spend at approximately 21% of sales given the aggressive menu expansion...Cepheid’s consumable growth is in acceleration mode. We expect CPHD’s reagent revenues to grow 37% in 2012 following 28% growth this year as its test menu expands while converting laboratories to molecular testing."
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On Frelick's small-cap pick, OraSure Technologies (Nasdaq: OSUR)(Buy-rated): "OraSure is embarking on two new incremental revenue opportunities that provide high value and improve clinical outcomes...OSUR recently received a CLIA waiver for its HCV rapid test, which opens up its marketing reach to 180,000 CLIA-waived sites and will be detailed by the Merck (NYSE: MRK) sales force. We anticipate a revision to HCV testing guidelines in the spring following the BEST-C study."
Mid-Cap Pick, Cepheid (Nasdaq: CPHD)(Buy-rated): "Our channel checks reveal that CPHD customers consistently cite labor savings and the broad test menu as keys to GeneXpert adoption. The GeneXpert system is easy to use and does not require additional personnel to operate. The platform has 11 FDA-approved tests, and CPHD expects to add another two tests in 2012 and another 10 by the end of 2014. CPHD expects to maintain its R&D spend at approximately 21% of sales given the aggressive menu expansion...Cepheid’s consumable growth is in acceleration mode. We expect CPHD’s reagent revenues to grow 37% in 2012 following 28% growth this year as its test menu expands while converting laboratories to molecular testing."
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