CareDx: A GameChanger for Transplant Patients

08/10/2020 5:00 am EST


Hilary Kramer

Editor, GameChangers

CareDx (CDNA) has a game-changing test for transplant patients called AlloSure, explains Hilary Kramer, growth stock expert and editor of GameChangers.

AlloSure does not require the prior genotyping of either the patient or the donor, and it also offers a patient rejection rule-out test.

The company just recently reported second-quarter earnings. Revenues were much better than expected, up 33% to $41.8 million compared to expectations of $36 million.

There has been continued strength in AlloSure testing for transplant patients and a very rapid customer acceptance of RemoTraC monitoring service.

RemoTraC, which was introduced on March 17, accounted for 40% of monitoring results in the quarter as patients were eager to avoid hospital visits due to COVID-19.

On an adjusted basis, the company earned $0.04 a share in the quarter vs. breakeven last year and $0.08 better than expectations. However, if you exclude government payments from the CARES relief act, results in the quarter were in line as start-spending for RemoTraC narrowed operating margins.

This was an encouraging quarter for the company, especially due to some of the newer products, such as a new matching system for donors and patients that just received government approval.

CDNA still has a lot of growth potential ahead of it, and I expect the stock to continue to do well. CDNA is a buy below $34. My target is $40 per share.

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