Quidel Slid 5% Following Canaccord Downgrade To Hold

• The share price of Quidel Corporation QDEL has declined 28.47 percent over the past three months, falling almost to its 52-week low on Tuesday at $15.53.
• Mark Massaro of Canaccord Genuity on Tuesday downgraded the rating on the company from Buy to Hold, while lowering the price target from from $22 to $18.
• The downgrade is based on a more cautious stance on the duration and strength of the flu season in 2016, as well as of the pace of growth of the company’s new products.

Analyst Mark Massaro explained, “We've been patient to see if this year might mirror the 2010-2011 flu season, but the pacing of the CDC data through January prompts us to lower our Q1/16 estimates.”

Although Quidel has been developing several “compelling” instrument platforms, Massaro prefers to take a more cautious stance on the company’s market share gains, as well as the contribution during 2016 and 2017 of Quidel’s new test launches.

Massaro expects the company’s biggest launch so far to be Savanna, which is scheduled for launch in 2017 in the U.S. and in 2016 outside the U.S. However, a significant impact of this launch is likely to only be felt in 2018.

“We could get more positive on the stock if QDEL executes on a dynamic, accretive acquisition that reduces its dependence on respiratory products, or makes bigger traction from new products vs. our expectations,” Massaro added.