Neogenomics: Needham Keeps Buy Rating, Raises PT to $14 from $8

Neogenomics: Needham Keeps Buy Rating, Raises PT to $14 from $8

NeoGenomics Inc. (NEO) has received a significant boost from Needham & Company, which maintained its Buy rating while raising the price target (PT) for the company's stock to $14 from $8. This update comes amidst a challenging period for the clinical laboratory company, which has been under investigation for potential securities fraud and has reported substantial financial setbacks.

In the second quarter (Q2) of 2025, NeoGenomics reported a revenue of $181.3 million, down 15.6% year-over-year, and a net loss of $45.1 million, up from $37.5 million in the same quarter last year [1]. The company's full-year 2025 revenue forecast was revised downward to a range of $720 million to $726 million, down from the previous estimate of $740 million to $750 million [2]. Additionally, the adjusted EBITDA projection for the year was lowered to a range of $41 million to $45 million, from the previous estimate of $45 million to $50 million [3].

Despite these financial challenges, NeoGenomics has achieved a significant legal victory. A federal judge in North Carolina granted the company's motion for summary judgment in a patent dispute with rival cancer test developer Natera Inc. (NTRA), allowing NeoGenomics to commercialize its RaDaR ST assay without any constraints in the U.S. [4]. This victory is expected to enhance NeoGenomics' market position and revenue streams.

Needham's positive outlook on NeoGenomics is driven by the potential long-term benefits of the patent victory. The company's stock has been volatile, with analysts expressing concern about the potential impact of the ongoing investigation. While some analysts have downgraded the stock due to the financial setbacks and ongoing investigation, others have maintained a neutral or buy rating, citing the potential long-term benefits of the patent victory [5].

Investors should closely monitor the situation and consider the potential risks and opportunities associated with NeoGenomics' financial health and legal issues. The company's recent patent victory could provide a boost to its market position and revenue streams, but the ongoing investigation for potential securities fraud remains a significant challenge.

References
[1] https://www.marketwatch.com/investing/stock/neo
[2] https://seekingalpha.com/news/4490420-neogenomics-stock-up-court-win-natera
[3] https://www.marketwatch.com/investing/stock/neo
[4] https://seekingalpha.com/news/4490420-neogenomics-stock-up-court-win-natera
[5] https://www.investing.com/news/analyst-ratings