UPDATE: Sequenom Upgraded to Outperform at Wedbush after Overblown Fears from WSJ Article
In a report published by Wedbush Securities, analyst Zarak Khurshid upgraded Sequenom (NASDAQ: SQNM) from Neutral to Outperform and maintained a $5 price target.
In the report, Wedbush noted, "We suspect that yesterday's ~5% selloff was partially due to a leaked WSJ article, which included comments from the FDA around a proposal to regulate new prenatal screening tests, that has been in the works for two years and is under "administrative review". In addition, a quote in the article from the FDA's head of diagnostics read “We have been trying to plug some of the regulatory gaps.” Both the WSJ article and a recent piece from Genomweb recapping a talk from the ACMG meeting on 3/23/13, highlighted cases of false positives which have helped to reignite fears around FDA regulation, in our view. Due to the rapid pace of adoption and complexity (four existing players, ACOG guidelines endorsement) we believe the FDA has missed its window to regulate the non-invasive prenatal testing market, thus reducing the risk of disruption."
Shares of Sequenom closed Wednesday at $3.87.
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