GH Stock Forecast & Price Target

Guardant Health, Inc. has demonstrated a strong financial performance with a noteworthy 30% year-over-year revenue growth in the fourth quarter, totaling $202 million, signaling robust demand for its liquid biopsy tests. The company's adjusted gross margin improved to 63%, reflecting its operational efficiency and favorable reimbursement trends, particularly with the Medicare rate for its services increasing significantly. Additionally, the firm anticipates a continuous upward trajectory in oncology revenue, projected to grow approximately 15% year-over-year, supported by a rise in clinical test volumes and favorable insurance coverage policies that encourage repeated testing.

Guardant Health is currently facing multiple challenges that contribute to a negative outlook for its stock, particularly related to slower-than-expected growth in its therapy selection franchise and weaker-than-projected adoption of its MRD test, Reveal. Additionally, the company's colorectal cancer screening test, Shield, is at risk of not achieving Advanced Diagnostic Laboratory Test (ADLT) status and lacks inclusion in the U.S. Preventive Services Task Force (USPSTF) guidelines, leading to anticipated lower adoption rates. Furthermore, anticipated reductions in the cost of goods sold (COGS) for Shield may face delays, with the company projecting a decrease only as test volumes scale significantly, overshadowing the immediate growth outlook.