UPDATE: Bank of America Reiterates Underperform Rating, Lowers PT on Genomic Health as 2014 Outlook is Below Expectations

In a report published Wednesday, Bank of America analyst Derik de Bruin reiterated an Underperform rating on

, but lowered the price target from $30.00 to $28.00. In the report, Bank of America noted, “GHDX expects to deliver 15-20% test vol. growth in FY14 , assuming single-digit growth in the core US invasive breast cancer mkt, further penetration into int'l mkts, particularly W. Europe, greater traction from the DCIS test & growing adoption of the prostate test (~10% of total test vols. by YE14 vs. 3% in 4Q13). Despite this robust outlook, product sales are only expected to grow by 7%-10% in part due to lower ASPs overseas pending broader coverage (~$2,500 vs. ~$3,000) along with limited payor coverage of new tests (DCIS & prostate). Moreover, profitability remains elusive for GHDX as the company expects to ramp its sales & marketing expenses by over 23% y/y to support penetration of new markets. Overall, we remain cautious on GHDX shares given limited near-term catalysts, growing competition in the U.S. invasive breast cancer market, and a more difficult reimbursement environment.” Genomic Health closed on Tuesday at $29.50.