Wedbush Securities Expects In-Line 4Q14 Results For EXACT Sciences

In a report published Wednesday, Wedbush Securities analyst Zarak Khurshid reiterated a Neutral rating and $19.00 price target on EXACT Sciences Corporation (NASDAQ: EXAS).In the report, Wedbush Securities noted, "Exact Sciences is a pure-play molecular diagnostic company pioneering a game-changing stool-based test for the early detection of colorectal cancer. The test, called Cologuard, was submitted to the FDA for PMA approval on June 10, 2013. Following a successful FDA panel meeting (11-0 vote) on 3/26 and FDA facility inspection completion as of 7/11/14 the test was approved by the FDA on 8/12/2014."The preliminary CMS coverage and pricing decision was issued on 10/9/14, which outlined favorable pricing (ultimately adjusted to $493) and a three-year testing interval. We expect the test to initially be used as an adjunct to colonoscopy and perhaps as a replacement in certain instances. The market potential is large, with a max US testing opportunity of around 19 MM and near-term addressable market of around 6.5 MM (or 2x the comparable FIT market), in our view. We remain long-term believers in the technology and management; however, the commercial risks are not insignificant and the current valuation is among the highest ever achieved for a pre-revenue diagnostics company. We could become more bullish on shares as a result of better clarity around private payor reimbursement, clinical adoption, collections, operating leverage and/or meaningful pipeline progress."EXACT Sciences closed on Tuesday at $25.75.