BioTech

Myriad Genetics, Inc. (NASDAQ:MYGN) Heavily Shorted but Added to S&P Index

Myriad Genetics, Inc. (NASDAQ:MYGN)

Heavily shorted Myriad Genetics, Inc. (NASDAQ:MYGN) shares rose over 7% in Friday’s after-hours trading on news that the biotech firm was going to be a new constituent of the S&P SmallCap 600. Additionally, the shares will be listed on the S&P Biotechnology sub-industry index. Leaving the S&P SmallCap 600 will be Inteliquent, Inc. (NASDAQ:IQNT).

Myriad Genetics Inc. (NASDAQ:MYGN) develops molecular diagnostic tests that: determine the risk of developing disease, accurately diagnose disease, assess the risk of disease progression, and guide treatment decisions across six major medical specialties where molecular diagnostics can significantly improve patient care and lower healthcare costs. Myriad is focused on three strategic imperatives:  maintaining leadership in an expanding hereditary cancer market, diversifying its product portfolio through the introduction of new products and increasing the revenue contribution from international markets.

Last week Myriad Genetics Inc. (NASDAQ:MYGN) release financials for Q2, 2017. Revenues rose 1.5% YoY ($196.5 vs. $193.3 million), and adjusted EPS dropped from $0.41 to $0.09 YoY. YoY earnings dropped from $30.3 million to $5.9 million. Guidance was also given for Q3, 2017: $188-$190 million with adjusted EPS expected between $0.23 and $0.25. For 2017, Myriad expects revenues of $745 – $755 million (2016 revenues were $753.8 million) and adjusted EPS between $1.00 and $1.05 (2016 EPS was $1.79).

Mark C. Capone, president and CEO, Myriad Genetics (NASDAQ:MYGN) stated in a press release – “Importantly, our diversification strategy is working with new products now contributing more than two thirds of testing volume. We also made steady progress on increasing reimbursement that will ultimately unlock significant operating leverage and long-term shareholder value.”

Myriad has had decent EPS for its shareholders – ranging from $1.33 on 2012 to $1.79 last year. Sales have also improved since 2012 when Myriad posted $496 million and posted $753.8 million in 2016. Despite these positive numbers, MYGN remains heavily shorted at over 35% of its float – a large number for a company that S&P has enough confidence to include in one of its high profile indexes.

Analysts’ consensus price target is $9. Of the 16 analysts that cover MYGN, nine rate the shares as a “Hold”, four rate the shares as a “Sell”, one rates MYGN as a “Underperform”, and two rate MYGN as a “Strong Buy”.

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

2/10/2017
Ticker Symbol MYGN
Last Price a/o 7:59 PM EST  $                    17.07
Average Volume                1,160,000
Market Cap (mlns)  $              1,100.00
Sales (mlns) $750.90
Shares Outstanding (mlns) 69.06
Share Float (mlns) 68.1
Shortable Yes
Optionable Yes
Inside Ownership 1.60%
Short Float 35.14%
Short Interest Ratio 20.7
Quarterly Return -8.00%
YTD Return -4.08%
Year Return -53.14%

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Marc has a degree in economics and a MSc. in Finance. Marc worked for global investment firms in Europe and the United States as an analyst, fund manager, and consultant.

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