Investors looking for good plays in the diagnostics space have some difficult choices to make. High-quality companies like Becton Dickinson (BDX) or Trinity (TRIB) don't come all that cheap, while others like LipoScience (LPDX) have some serious issues to address. Cepheid (CPHD)
is definitely in that former camp, as the company's GeneXpert system is
an excellent automated molecular diagnostics platform that has garnered
leading share in hospital-acquired infections and continues to leverage
new test launches.
Cepheid is expensive by almost any metric, but
med-tech investors are willing to pay for growth and Cepheid's strong
share and differentiated platform could yet attract strategic buyers.
These shares are definitely vulnerable to any operational stumble, not
to mention a sudden shift in market sentiment regarding the appropriate
premium for growth, but I wouldn't step in front of them (to short), nor
would I rush to sell if I owned them.
Read more here:
Great Growth Doesn't Come Cheap With Cepheid
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