Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

On Jun 26, we upgraded genetic devices maker Affymetrix Inc. (AFFX - Analyst Report) to Neutral from Underperform, as we believe that the company has reasonable upside potential going forward, despite disappointing first-quarter results.

Why the Upgrade?

Affymetrix posted first-quarter 2013 adjusted loss per share of 1 cent, wider than the Zacks Consensus Estimate of break-even earnings. However, it was narrower than the year-ago adjusted loss per share of 3 cents. Revenues increased 19.5% (including the eBioscience acquisition) year over year to $77.9 million but were 4.9%.lower than the Zacks Consensus Estimate of $82 million.

Following the release of the first-quarter results, the Zacks Consensus Estimate for 2013 declined to a loss of 1 cent per share from earnings of 5 cents per share. Moreover, the Zacks Consensus Estimate of a loss for 2014 has also declined (down 50% to 6 cents per share) significantly.

However, we believe that Affymetrix is ready for a turn around and the worst days are over for the company. In the face of declining demand for Affymetrix’ flagship GeneChip Expression products, management’s strategy to transform into a company with a broad reach in the high-growth markets for translational medicine, molecular diagnostics and applied markets is encouraging.

New products, acquisitions, strategic agreements should propel growth going forward. Additionally, the company’s restructuring and debt reduction efforts should boost margins and profitability.

Meanwhile, we are aware of the fact that Affymetrix faces intense competition and pricing pressure across its core markets and is exposed to tight global academic spending environment. Hence, we choose to remain on the sidelines regarding Affymetrix, as evidenced by its Zacks Rank #3 (Hold).

Other Stocks to Consider

Other stocks in the Medical-Biomed/Gene industry that are currently performing well include Biogen Idec (BIIB - Analyst Report), Targacept (TRGT - Snapshot Report) and Protalix BioTherapeutics (PLX - Snapshot Report). All these companies carry a Zacks  Rank #1 (Strong Buy).

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
BITAUTO HOLD BITA 35.33 +14.82%
ANI PHARMACE ANIP 24.79 +14.66%
E HOUSECHINA EJ 10.99 +9.24%
CANADIAN SOL CSIQ 26.97 +7.15%
INTERNATIONA ICAGY 33.30 +5.38%