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Genomic Health Inc.

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Genomic Health exited the first quarter of 2017 on a dismal note with earnings and sales missing the Zacks Consensus Estimates. However, the bearish result has not affected the company’s share price performance. For the last three months, the company is trading above the broader Medical-Biomed/Genetics industry. We are encouraged about declining cost of sales combined with gross margin expansion, on account of higher revenue growth. The company continues to experience strong results related to its cancer scores. On the flip side, we are concerned about the company’s rising operating losses as well. Apart from this, Genomic Health has not issued any guidance which is discouraging. Its sole reliance on profitability of Breast Oncotype DX test is also a growing concern.

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