On Monday, Canaccord Genuity maintained a Buy rating and a $5.00 price target on shares of Exagen (NASDAQ:XGN). Following the company's first-quarter results for 2024, released before the market opened, the firm expressed continued confidence in the stock.
Exagen's performance exceeded both the analyst's forecasts and the FactSet consensus, reporting a trailing twelve-month average selling price (ASP) per test of approximately $377, a significant increase from the fourth quarter of 2023.
The company's AVISE CTD test volume remained consistent with the previous quarter's figures, despite earlier pricing changes that temporarily affected ordering patterns. Management is optimistic that the negative impact on volume from these pricing adjustments has diminished, indicating an expected rise in AVISE CTD test volumes in future quarters.
In a positive development, Exagen has raised its revenue and adjusted EBITDA outlook for 2024, although the adjustments are described as modest. The firm is also on course to meet its objectives that will lead to cash flow breakeven, signaling effective management of its financial resources.
The analyst highlighted Exagen's successful efforts to enhance ASP and decrease cash burn, which are contributing to the company's financial improvements. With these strategic moves, Exagen is progressing on its path to reacceleration.
InvestingPro Insights
InvestingPro data indicates that Exagen (NASDAQ:XGN) has a market capitalization of $28.46 million, underscoring its position in the market. The company's revenue growth has been robust, with a 20.12% increase over the last twelve months as of Q1 2024, and an even more impressive quarterly revenue growth of 28.36% in Q1 2024. This aligns with the company's raised revenue outlook and supports the analyst's optimism for Exagen's financial trajectory.
InvestingPro Tips highlight that Exagen is trading at a low revenue valuation multiple and holds more cash than debt on its balance sheet, suggesting a strong financial position relative to its market valuation. However, it's important to note that the company is quickly burning through cash and analysts have revised their earnings downwards for the upcoming period. Investors considering Exagen should be aware of these dynamics as they weigh the potential for investment. For those looking to delve deeper into Exagen's financials, there are 6 additional InvestingPro Tips available at https://www.investing.com/pro/XGN. To access these insights and more, use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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