Exagen's 2025 Results: A Tactical Reassessment of the Biomarker Catalyst

Exagen delivered a solid finish to 2025, reporting record full-year revenue of $66M to $67M, representing growth of at least 19% year-over-year. The company's core driver, the AVISE CTD platform, showed significant pricing power, with its trailing 12-month average selling price expanding by at least $30 to a range of $441 to $445. This ASP expansion, coupled with test volume growth, powered the top-line acceleration. Financially, the year ended on a strong note, with the company strengthening its balance sheet to $32M in cash and cash equivalents, a $10 million increase from the prior year.

The immediate investment question is whether this strong execution has already been priced in. The stock's valuation may not yet reflect the full potential of the new biomarker launches the company has hinted at. The record revenue and cash build provide a solid foundation, but the catalyst for a re-rating likely hinges on the commercial uptake of these upcoming enhancements. For now, the results confirm operational discipline and growth momentum, setting the stage for the next phase of execution.

The New Biomarker Launch: The Next Immediate Catalyst

The company's most tangible near-term catalyst is already in motion. In January 2025, Exagen executed its planned commercial launch of new SLE and RA biomarkers, following conditional approval from the New York State Department of Health in January 2025. This event is not a future promise; it is a completed action that directly addresses the core market for autoimmune diagnostics.

The market potential here is clear and immediate. These new assays are designed to be incorporated into the AVISE CTD platform, with the explicit goal of improving the clinical utility of the test suite. For clinicians, this means better tools to definitively diagnose patients, particularly in ambiguous cases of lupus and rheumatoid arthritis. The company frames this as a way to shorten autoimmune diagnostic journeys. In practice, this enhanced utility can translate into higher test adoption rates and stronger pricing power, directly feeding the growth engine already demonstrated by the platform's record full-year 2024 revenue.

This launch is the next leg of the growth story. It follows the record revenue and cash build, providing a concrete commercial event to drive the next phase of execution. The catalyst is tactical: it's about proving that the new biomarkers can accelerate the platform's penetration and further expand its average selling price. The market has already seen the operational strength; now it needs to see the commercial impact of this specific enhancement.

The Market's Immediate Take: Did the Stock Move on the News?

The stock's reaction to the preliminary results announcement on January 11, 2026, is the market's first verdict on whether this operational strength is enough to drive a re-rating. In a clean, event-driven setup, the key is to watch for any volume spikes or price gaps that signal institutional positioning around the news. A muted move could indicate that investors are already pricing in the growth trajectory, while a strong pop would suggest the market sees fresh catalyst potential.

The evidence from the CEO's statement provides a crucial, early signal. He noted the company delivered "significant topline growth... despite unexpected ASP headwinds in the second half of the year." This candid admission of a second-half pressure point is material. For a tactical investor, it introduces a note of caution. The record full-year revenue and cash build are positive, but the mention of headwinds raises questions about the sustainability of the 19%+ growth rate and the durability of the ASP expansion. The market will be watching to see if the new biomarker launch can quickly offset these pressures.

The immediate catalyst is now the commercial execution of those January 2025 biomarker enhancements. The stock's move on the news will hinge on whether the market views this as a proven growth engine or a future promise. A strong reaction would likely require confirmation that the new assays are driving volume and pricing power in the current quarter. Without that, the preliminary results may simply be seen as a continuation of the known story, leaving the stock vulnerable to the headwinds mentioned by management.

Valuation and Analyst Sentiment: Is the Market Ahead?

The market's verdict, as reflected in analyst sentiment, is one of cautious optimism. The consensus remains a "Moderate Buy," but the average price target has climbed to $14.17. That figure implies a staggering 123% upside from the recent $6.34 share price. More telling than the average is the recent trend of upward revisions. Firms like Canaccord have raised their targets to $15, while B. Riley initiated coverage with a $15 price tag, and one analyst even set a target as high as $18. This growing confidence is explicitly tied to the potential of the AVISE CTD platform.

The question for a tactical investor is whether this optimism is ahead of the commercial curve. The analyst targets are clearly pricing in the successful adoption of the new SLE and RA biomarkers launched in January 2025, as well as the continued ASP expansion that powered the record 2025 revenue. The targets embed a belief that these catalysts will drive the growth trajectory higher. Yet, the market's reaction to the preliminary results suggests some skepticism. The stock's muted move on the news of record revenue and cash build, coupled with the CEO's mention of second-half ASP headwinds, indicates that the market is weighing these near-term pressures against the future promise.

The setup now hinges on execution. The analyst consensus is a forward-looking bet that Exagen can overcome its recent headwinds and validate the biomarker launch's commercial impact. For the stock to re-rate toward those $14+ targets, the company needs to deliver tangible proof in the coming quarters that the new assays are accelerating test volume and stabilizing or even reversing the ASP pressure. Until then, the valuation gap between current levels and analyst targets represents a bet on flawless execution of the next catalyst. The market may be ahead on the long-term story, but the tactical opportunity depends on seeing that story play out in the numbers.

Catalysts and Risks: What to Watch Next

The immediate investment thesis now pivots to execution. The primary catalyst is the commercial performance of the new SLE and RA biomarkers, which were launched in January 2025. The market needs to see tangible proof that these enhancements are accelerating test volume and stabilizing the average selling price. The upcoming Q1 2026 earnings report will be the first major test, providing the first full-quarter look at the launch's impact on key metrics like AVISE CTD volume and trailing 12-month ASP trends.

The specific numbers to watch are clear. The company's record 2025 revenue of at least $66 million was powered by an ASP expansion of at least $30. Management's recent note about unexpected ASP headwinds in the second half of the year is a critical risk to monitor for recurrence. Any further pressure on pricing would directly challenge the growth model. Conversely, a strong rebound in ASP or volume growth in the first quarter would validate the biomarker launch's clinical utility and commercial traction.

Key risks remain. Slower-than-expected market adoption of the new assays could limit their impact on the platform's penetration. The company's continued cash burn, despite a $10 million year-end cash increase, is another watchpoint. While the $32 million cash position provides runway, it underscores the path to profitability remains a work in progress. The upcoming audited earnings release will be the next major catalyst, confirming or revising these preliminary numbers and offering a clearer view of the headwinds and catalysts in play.