Guardant Health (GH) +20% is surging after the company reported better than expected first quarter results yesterday afternoon.
Guardant Health is a precision oncology company that helps doctors more accurately detect and treat cancer patients and biopharmaceuticals more effectively develop targeted cancer therapies.
The company has blown out revenue estimates in all three quarters since it sold 12.5 mln shares at $19 in an IPO last October.
First quarter revenue grew 120% to $37 mln, which marked an acceleration from 65% growth in the fourth quarter.
Tests to clinical customers were up 31% to 9,521 while tests to biopharmaceutical customers increased 61% to 3,762.
The company raised fiscal 2019 revenue guidance by 11% at the midpoint to $145-150 mln, representing 60-65% growth.
Guradant has reported on over 70,000 clinical samples, working with over 40 biopharma partners and over 5,000 oncologists.
Guardant360 is a liquid biopsy blood test for doctors that uses genomes to determine the best treatment for cancer patients. More accurate than a tissue biopsy, genomic information results in better therapies and better outcomes for patients.
Launched in 2017, GuardantOMNI is a tool biopharmaceutical companies can use to help accelerate clinical development programs for targeted cancer therapies and immuno-therapies. More comprehensive than the Guardant 360, it uses a 500-gene panel to help increase the odds of success to determine the right molecular profile for cancer drugs.
President, COO, and co-founder AmirAli Talasaz's previous genetic cancer analysis company, Auiphex Biosciences, was acquired by genome sequencing leader Illumina (ILMN). Chief Executive Helmy Eltoukhy also worked at Illumina after it acquired his semiconductor sequencing company Avantome.
Guardant Health has a very promising outlook as a next generation oncology company, but that seems to already be reflected in the aggressive valuation. The company is worth nearly $6.5 bln, trading at ~43x sales estimates. That make it even more pricey than a handful of the hottest enterprise software stocks that trade at roughly 20x sales estimates or higher.