Rodman & Renshaw Increases Their Price Target on Sequenom Inc. (SQNM) to $25; Maintains Market Outperform

July 21, 2008 8:31 AM EDT

Rodman & Renshaw increases their price target on Sequenom Inc. (NASDAQ: SQNM) from $13.50 to $25 and maintains their Market Outperform rating.

The firm said, "We derive our target price from a sum-of-the-parts valuation that ascribes $380MM to the molecular analytics component of Sequenom’s business and $890MM to the diagnostics component, based on comparable firms price multiples on forward sales. The key difference in our assumptions is the projection that Sequenom will commercialize its non-invasive prenatal diagnostics tests independently, without licensing them to a partner. In this manner, Sequenom is likely to benefit handsomely from the potentially lucrative franchise that such tests represent."

In addition, the firm highlights that Sequenom aims to become a leader in non-invasive prenatal diagnostics (NIPDs). The firm believes that sales of genetic material-based NIPDs could grow to $2 billion in sales by 2016. Also in the firm's view, the company "currently enjoys an unrivaled position in the domain of non-invasive prenatal diagnostics based on the high level of accuracy and reproducibility that is achievable with its tests."

Sequenom, Inc. is a genetics and molecular diagnostic company and provides genetic analysis products that translate genomic science into solutions for biomedical research, molecular medicine, noninvasive prenatal testing, and livestock and agricultural applications.

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