Wedbush Reaffirms Outperform Rating on Vermillion

Wedbush is reaffirming its Outperform rating on shares of Vermillion, Inc.

. “Given that it remains early innings of OVA1 launch, we are taking a careful approach to our revenue model for both on- and off-label OVA1 use,” Wedbush writes. “Our $7 price target is based roughly on 12x our $10 MM 2013E revenue estimate discounted back at 15%, plus our projected 2013 cash balance of $2 MM, plus $20 MM assigned to the PAD opportunity, which is several years from market. Shares are trading at a premium to the group on a 2011E EV/Sales multiple basis (16x vs. the molecular diagnostics subgroup mean of 3.7x).” Vermillion closed Thursday at $5.83.