Chromavision Analysis

Part
01
of four
Part
01

Press Scan - Chromavision

On May 2, 2019, NeoGenomic's share price rose by 551% over five years, representing an epic gain for some of the company's long term investors.

Chromavision - Overview

Press Scan - NeoGenomics

1. NeoGenomics Shareholders Have Enjoyed A Whopping 551% Share Price Gain
2. NeoGenomics reports record revenue growth for the second quarter
3. NeoGenomics Reports 40% Revenue Growth to $107 Million in the Fourth Quarter
  • On February 27, 2020, the company announced that in the last quarter of 2019, it saw a revenue increase to $106.9 million. This comes from a 41.7% increase in the company's clinical service revenue and a 27.5% increase in the company's pharmaceutical service revenue.
  • In 2019, the company's revenue was $408.8 million, a 48% increase over 2018.
4. Why NeoGenomics Fell as Much as 20.2% Today
5. The Case for and Against NeoGenomics, Inc.
6. Seagate Development's NeoGenomics' deal the result of being in the right place
7. PPD boosts clinical trials testing with NeoGenomics lab opening in Singapore
8. NeoGenomics Acquires Oncology Division from Human Longevity
9. NeoGenomics Announces Leadership Appointments
Part
02
of four
Part
02

Investment Data Analysis - Chromavision

As of March 20, 2020, NeoGenomics market cap and trade volume was $2.67 billion and 1,594,184, respectively. On January 9, 2020, its market cap was $3.107 billion. Also, the company was worth $430.25 million on October 21, 2015, when it acquired Clarient. Inc.

Chromavision - Overview

Investment Data Analysis - Chromavision

Clarient Inc.

1. Net Revenue
2. Number of Active Customers
3. Number of Tests
4. Net Loss

NeoGenomics

  • On February 27, 2020, the company announced that in the last quarter of 2019, it saw a revenue increase to $106.9 million. This comes from a 41.7% increase in the company's clinical service revenue and a 27.5% increase in the company's pharmaceutical service revenue.

NeoGenomics - Five Years Revenue Breakdown

  • From 2015 to 2019, the company experienced consistent growth in net revenue. A breakdown of the statistics is provided below.
1. Net Revenue
Part
03
of four
Part
03

SWOT - Chromavision

Research on Chromavision found that the company was renamed to Clarient, Inc. before it was acquired by NeoGenomics in 2015. Hence, the team proceeded with a SWOT analysis of NeoGenomics. A tradition of fast turnaround time, a strong scientific team, and innovative service offerings are some strengths of the company. A substantial amount of indebtedness has been identified as a perceived weakness of NeoGenomics. The company is threatened by competition in the highly competitive cancer testing industry. However, the continual introduction of innovative products, a rise in the prevalence of cancer, and an awareness of the need for genetic and molecular testing present opportunities for NeoGenomics to grow its business.

Strengths

  • NeoGenomics is a "leading global oncology diagnostics company serving biopharmaceutical companies as well as practicing oncologists and pathologists" with 9 facilities in the U.S. and 1 in both Switzerland and Singapore.
  • They offer a wide range of cancer-focused testing services including cytogenetic, fluorescence in-situ hybridization, molecular testing, morphologic analysis, and others.
  • NeoGenomic's competitive strength among competitors in the industry stems from it's "superior testing technologies and instrumentation, laboratory information system, client education programs, and broad domestic and growing international presence".
  • The company is also strengthened by its tradition of fast turnaround time, over 100 M.D.s and Ph.Ds in its scientific team, and innovative service offerings.
  • NeoGenomics recorded net revenue of $408.830 million with about 1,700 employees in 2019 which represents a 47.7% rise from its 2018 revenues.
  • The strong performance in 2019 was boosted by the acquisition of Genoptix in 2018 and the completion of a $160.8 million net equity offering.
  • Furthermore, NeoGenomics has a diverse range of clients spread across the globe with no single client contributing more than 10% of the company's annual revenue. This shows that the company does not depend on any major client.

Weaknesses

  • A perceived weakness of NeoGenomics is its substantial amount of indebtedness. In 2019, the company secured a new credit agreement with PNC Bank National Association for $100 million revolving credit facility, $100 million term loan facility, and $50 million delayed draw term loan.
  • The company is highly dependent on key personnel for the effective running of its business.
  • Most of the company's laboratory facilities and corporate offices are on leased properties.
  • The company has a weak social media follower count with only 606 followers on Facebook and 1,592 on Twitter.

Opportunities

  • Industry experts project the global cancer diagnostics market to rise at a CAGR of 7% to hit $249.6 billion by 2026. The growth is predicted to be driven by the continual introduction of innovative products and the "increasing need for early diagnosis of various diseases".
  • With more genes and genomic pathways implicated every year in the development and/or clinical course of cancer in the U.S., the prevalence of cancer among senior citizens in the U.S. with "one in four senior citizens likely to develop some form of cancer during the rest of their lifetime once they turn sixty", the current awareness of the need for genetic and molecular testing, and other factors, opportunities abounds for NeoGenomics to grow its business and consolidate its status as one of the leading companies in the cancer testing and information market.
  • NeoGenomics currently has a presence in North America, Europe, and Asia. There is an opportunity for the company to expand into other markets such as Africa and South America, as well as improve its presence in regions where they currently have locations in other to increase its market share in the cancer testing industry.
  • Furthermore, the company can build its social media fan base to leverage social media marketing to reach out to more clients.

Threats

  • NeoGenomics faces competition from major national "medical testing laboratories, hospital laboratories, and in-house physician laboratories" that posses bigger financial resources and production capabilities in the U.S. clinical services market.
  • In the pharma services segment, NeoGenomics also faces competition from numerous Contract Resource Organizations (CROs) with a superior global presence.
  • The company's business is subject to threats that could emanate from "rapid scientific developments, evolving industry standards and customer demands, and frequent new product introductions and enhancements".
  • Furthermore, with NeoGenomics' international presence in Singapore and Switzerland, its finances are subject to risks from fluctuations in foreign currency exchange rates.
Part
04
of four
Part
04

Company Overview - Chromavision

Chromavision Inc. was a laboratory medicine diagnostics company founded in 1993 and based in San Juan Capistrano, California. In 2005, it changed its legal name to Clarient Inc. The company was later purchased by NeoGenomics, a subsidiary of GE Healthcare.

Company History - Chromavision

Clarient Inc.

  • Clarient Inc. headquarters was located in Aliso Viejo, California. The company's mission was to help "improve the lives of those affected by cancer through translating cancer discoveries into better patient care."
  • In 2005, Clarient signed a development and distribution agreement with Dako, a global leader in pathology diagnostics systems.
  • The agreement with Dako enabled the company to hold-fort its legacy position as a top player in cellular digital image analysis.
  • In 2008, Clarient announced its collaboration with Prediction Sciences, LLC, towards the commercialization of its breast cancer test.
  • In 2009, the company acquired Applied Genomics, Inc. This provided Clarient with ready-for-market IHC-based tests, tissue bank samples for research, and intellectual property content.
  • According to the company, its offerings included "a wide range of oncology diagnostic testing and consultative services which included technical laboratory services and professional interpretation of laboratory test results."
  • In the second quarter of 2009, Clarient initiated a new gene mutation test known as the EGFR Mutation Test, which enabled physicians to select the proper kind of therapy for patients who are diagnosed with non-small cell lung cancer.
  • As at the end of 2009, the company had 361 employees.
  • From 2005 to 2009, the company experienced consistent growth in net revenue, number of customers, and the number of tests and a consistent fall in its net losses. A breakdown of the statistics is provided below.
1. Net Revenue
2. Number of Active Customers
3. Number of Tests
4. Net Loss

NeoGenomics

Stable Investment/Financial Health

  • Analysis of the company's financial performance since its inception in 1993 until its purchase by NeoGenomics in 2015, reveals that the company can be inferred to be a stable investment and in good financial health.
  • Concerning profitability, the company went public in 1997 at $5 per share and was sold at $7.50 per share, which represents a $2 margin.
  • Other financial successes of the company are recorded above.
Sources
Sources

From Part 02