Veracyte Gains 44% in a Year: What's Driving the Stock?

Veracyte VCYT has seen impressive growth over the past year, with its shares jumping 44%. It has significantly outperformed the industry’s 3.9% rise and the S&P 500 composite’s 24.4% gain.With a Zacks Rank #1 (Strong Buy) at present, the global diagnostics company is gaining more market shares from the strength of the Afirma solution. Veracyte is also making strides with the Decipher Prostrate test and advancing its long-term growth drivers, which are highly encouraging. Headquartered in San Francisco, CA, Veracyte offers a wide array of advanced genomic tests that combine deep scientific, clinical and machine-learning expertise and other capabilities. These highly effective tests improve diagnostic, prognostic and treatment decisions in cancer and other challenging diseases, helping patients avoid unnecessary procedures and reducing the time to find appropriate treatment. In the United States, Veracyte provides tests through its central laboratories while expanding global access by partnering with local labs.Factors Favoring VCYT’s GrowthThe rally in the company’s share price can be linked to the robust momentum of the Afirma solution, which provides physicians with clinically actionable results from a single fine needle aspiration or FNA biopsy.  In the third quarter of 2024, the company reported a 12% increase in the Afirma test results, banking on a growing number of new customers and strong retention of old ones. Veracyte continues to gain market share as awareness of the test’s quality and performance grows. The company is also hopeful about its research-use-only (RUO) Afirma GRID offering, which is expected to help Veracyte expand in the endocrinology market.Image Source: Zacks Investment ResearchAdded to this, the Decipher Prostate cancer tests are showing strength in predicting a patient’s risk of progressing to metastatic disease within five years, helping physicians determine the right treatment plan. A record volume of 21,250 tests were conducted in the third quarter of 2024, reflecting growth across all National Comprehensive Cancer Network or NCCN’s localized risk categories. The company extended the Decipher franchise into the bladder, addressing nearly 82,000 people diagnosed with the disease annually in the United States. Also, Veracyte is developing and validating the Decipher offering for patients with advanced-stage, metastatic and castrate-resistant prostate cancer.Investors are also upbeat about Veracyte heavily investing in three long-term growth drivers, including the Percepta Nasal Swab test. The company is also working on a strategy to deliver IVD versions of its tests to physicians and their patients outside the United States. Through a multi-year deal with Illumina, the company is developing some of its molecular tests as decentralized IVD tests on their NextSeq 550Dx NGS instrument, using their large installed base and lower costs per test. The transition of test manufacturing operations from NanoString to the Marseille, France, facility has allowed the company to have more control of its IVD test supply chain.Risks for VCYTVeracyte is experiencing a notable drop in biopharma and other services revenues due to fewer customer projects, extended sales cycles and overall spending constraints across the industry. Worldwide macroeconomic issues such as geopolitical uncertainties and supply disruptions could also impact its margins.A Glance at VCYT’s EstimatesThe Zacks Consensus Estimate for Veracyte’s 2024 and 2025 earnings per share (EPS) is expected to increase 137.3% and 65.8% year over year, respectively, to 38 cents and 63 cents. In the past 30 days, the Zacks Consensus Estimate for the company's 2024 EPS has remained constant.Revenues for 2024 are projected to grow 22.9% to $443.9 million, while the same for 2025 is expected to reach $487.5 million.Other Key MedTech StocksSome other top-ranked stocks in the broader medical space are Abbott ABT, Haemonetics HAE and Boston Scientific BSX.Abbott has an earnings yield of 4.5% compared with the industry’s 0.3%. Abbott’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters and broke even in one, with the average surprise being 1.6%. Its shares have risen 1.2% compared with the industry’s 7.6% growth in the past year.ABT carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.Haemonetics, carrying a Zacks Rank #2 at present, has an estimated fiscal 2025 earnings growth rate of 15.9% compared with the industry’s 12.3%. Shares of the company have declined 8.3% against the industry’s 9.7% growth. HAE’s earnings surpassed estimates in three of the trailing four quarters and missed on one occasion, with the average surprise being 2.82%.Boston Scientific, carrying a Zacks Rank #2 at present, has a long-term estimated earnings growth rate of 13.8%. Shares of the company have surged 54.4% compared with the industry’s 9.7% growth. BSX’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 8.29%.Research Chief Names "Single Best Pick to Double"From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Abbott Laboratories (ABT): Free Stock Analysis Report Boston Scientific Corporation (BSX): Free Stock Analysis Report Haemonetics Corporation (HAE): Free Stock Analysis Report Veracyte, Inc. (VCYT): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks