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Veracyte Stock Surges 45.6% in a Year: What's Driving the Rally?
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Veracyte (VCYT - Free Report) shares have surged 45.6% in the past year, showing impressive momentum. It has significantly outperformed the industry’s 7.6% fall and the S&P 500 composite’s gain of 8.8%.
Presently carrying a Zacks Rank #2 (Buy), the global diagnostics company continues to benefit from the robust performance of Afirma and Decipher tests. Their solid future growth potential, along with strategic investment in the long-term growth drivers, are highly promising.
Based in San Francisco, CA, Veracyte offers advanced genomic tests that combine deep scientific, clinical and machine-learning expertise and other capabilities. These aid in improving diagnostic, prognostic and treatment decisions for cancer and other challenging diseases, helping patients avoid unnecessary procedures and speeding up treatment decisions. In the United States, Veracyte provides tests through its central laboratories while expanding global access by partnering with local labs.
Key Catalysts for VCYT’s Growth
The rally in the company’s share price can be linked to the strength of both Afirma and Decipher Prostate tests. In 2024, Afirma test volumes grew a strong 12%, with an 8% year-over-year increase in the fourth quarter despite challenging prior-year comps. A majority of growth in the quarter was driven by deeper penetration into existing accounts, along with the addition of sizable new customers. Additionally, the research-use-only (RUO) Afirma GRID data is driving strong interest from the KOL (key opinion leaders) and academic community, aiming to help Veracyteexpand into the endocrinology market.
Image Source: Zacks Investment Research
Meanwhile, the 2025 updated NCCN guidelines for prostate cancer reaffirm Veracyte’s Decipher as the gene expression test with Simon Level 1 evidence and the only one to be recommended by the panel to make personalized treatment decisions for prostate cancer patients. Decipher has seen remarkable adoption throughout 2024 and delivered record volume growth of 45% year over year in the fourth quarter. The company delivered 40% to 55% annual volume growth across each of the NCCN biopsy risk categories in the fourth quarter, from low-risk to intermediate-risk and high-risk.
Moreover, Veracyte is expanding the test to cover the entire prostate cancer risk spectrum. With key approvals secured and commercialization efforts underway, the company is preparing to launch into this expanded population in the first half of 2025, with test volumes expected to rise later in the year. Among its long-term growth drivers, Veracyte is committed to launching its test as IVD (in-vitro diagnostics) to address patient needs outside the United States, as well as innovations like the Percepta Nasal Swab test to tackle new cancer challenges. The company is also working on the first indication of its MRD (minimal residual disease) platform for muscle-invasive bladder cancer, leveraging the strong Decipher channel.
Risks for VCYT
Veracyte’s operations are susceptible to macroeconomic challenges, such as ongoing interest rate increases and inflation in the United States and global markets, as well as turmoil in the global banking and finance system, among others. Further, ongoing geopolitical uncertainties and supply disruptions can potentially hamper its profitability.
A Glance at VCYT’s Estimates
In the past 30 days, the Zacks Consensus Estimate for the company's 2025 earnings per share (EPS) has remained constant at $1.00. Revenues are projected to grow 9.5% to $486.2 million in 2025, while the same for 2026 is expected to reach $533.7 million, an increase of 9.3%.
Other Key Picks
Some other top-ranked stocks in the broader medical space are Cardinal Health (CAH - Free Report) , Resmed (RMD - Free Report) and Boston Scientific (BSX - Free Report) .
Cardinal Health has an estimated long-term earnings growth rate of 9.5% compared with the industry’s 9.4%. The company’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 9.6%. Its shares have risen 15.4% against the industry’s 4.4% decline in the past year.
Resmed, carrying a Zacks Rank #2 (Buy) at present, has an estimated fiscal 2025 earnings growth rate of 22.7% compared with the industry’s 18.8%. Shares of the company have risen 17.3% compared with the industry’s 7.7% growth. RMD’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 6.9%.
Boston Scientific, carrying a Zacks Rank #2 at present, has a long-term estimated earnings growth rate of 13.3%. Shares of the company have surged 54.4% compared with the industry’s 9.7% growth. BSX’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 8.3%.
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Veracyte Stock Surges 45.6% in a Year: What's Driving the Rally?
Veracyte (VCYT - Free Report) shares have surged 45.6% in the past year, showing impressive momentum. It has significantly outperformed the industry’s 7.6% fall and the S&P 500 composite’s gain of 8.8%.
Presently carrying a Zacks Rank #2 (Buy), the global diagnostics company continues to benefit from the robust performance of Afirma and Decipher tests. Their solid future growth potential, along with strategic investment in the long-term growth drivers, are highly promising.
Based in San Francisco, CA, Veracyte offers advanced genomic tests that combine deep scientific, clinical and machine-learning expertise and other capabilities. These aid in improving diagnostic, prognostic and treatment decisions for cancer and other challenging diseases, helping patients avoid unnecessary procedures and speeding up treatment decisions. In the United States, Veracyte provides tests through its central laboratories while expanding global access by partnering with local labs.
Key Catalysts for VCYT’s Growth
The rally in the company’s share price can be linked to the strength of both Afirma and Decipher Prostate tests. In 2024, Afirma test volumes grew a strong 12%, with an 8% year-over-year increase in the fourth quarter despite challenging prior-year comps. A majority of growth in the quarter was driven by deeper penetration into existing accounts, along with the addition of sizable new customers. Additionally, the research-use-only (RUO) Afirma GRID data is driving strong interest from the KOL (key opinion leaders) and academic community, aiming to help Veracyteexpand into the endocrinology market.
Image Source: Zacks Investment Research
Meanwhile, the 2025 updated NCCN guidelines for prostate cancer reaffirm Veracyte’s Decipher as the gene expression test with Simon Level 1 evidence and the only one to be recommended by the panel to make personalized treatment decisions for prostate cancer patients. Decipher has seen remarkable adoption throughout 2024 and delivered record volume growth of 45% year over year in the fourth quarter. The company delivered 40% to 55% annual volume growth across each of the NCCN biopsy risk categories in the fourth quarter, from low-risk to intermediate-risk and high-risk.
Moreover, Veracyte is expanding the test to cover the entire prostate cancer risk spectrum. With key approvals secured and commercialization efforts underway, the company is preparing to launch into this expanded population in the first half of 2025, with test volumes expected to rise later in the year. Among its long-term growth drivers, Veracyte is committed to launching its test as IVD (in-vitro diagnostics) to address patient needs outside the United States, as well as innovations like the Percepta Nasal Swab test to tackle new cancer challenges. The company is also working on the first indication of its MRD (minimal residual disease) platform for muscle-invasive bladder cancer, leveraging the strong Decipher channel.
Risks for VCYT
Veracyte’s operations are susceptible to macroeconomic challenges, such as ongoing interest rate increases and inflation in the United States and global markets, as well as turmoil in the global banking and finance system, among others. Further, ongoing geopolitical uncertainties and supply disruptions can potentially hamper its profitability.
A Glance at VCYT’s Estimates
In the past 30 days, the Zacks Consensus Estimate for the company's 2025 earnings per share (EPS) has remained constant at $1.00. Revenues are projected to grow 9.5% to $486.2 million in 2025, while the same for 2026 is expected to reach $533.7 million, an increase of 9.3%.
Other Key Picks
Some other top-ranked stocks in the broader medical space are Cardinal Health (CAH - Free Report) , Resmed (RMD - Free Report) and Boston Scientific (BSX - Free Report) .
Cardinal Health has an estimated long-term earnings growth rate of 9.5% compared with the industry’s 9.4%. The company’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 9.6%. Its shares have risen 15.4% against the industry’s 4.4% decline in the past year.
CAH carries a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Resmed, carrying a Zacks Rank #2 (Buy) at present, has an estimated fiscal 2025 earnings growth rate of 22.7% compared with the industry’s 18.8%. Shares of the company have risen 17.3% compared with the industry’s 7.7% growth. RMD’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 6.9%.
Boston Scientific, carrying a Zacks Rank #2 at present, has a long-term estimated earnings growth rate of 13.3%. Shares of the company have surged 54.4% compared with the industry’s 9.7% growth. BSX’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 8.3%.