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2012 Performance-Rayno Life Sciences Diagnostics And Tools: ILMN, NEOG, QDEL

|Includes:CEPHEID (CPHD), ILMN, NEOG, QDEL

Rayno Diagnostics and Tools -Another Year of Outstanding Performance

In a volatile year with a few earnings disappointments and the summer doldrums, the sector did quite well due to synergies with new drug therapies, technological innovation such as genomics and biomarkers, sales growth from new products and M&A.

We need to find new ideas as some of our companies have been acquired, most recently GenProbe (NASDAQ:GPRO). Here are some highlights of our current diverse portfolio.

  • Abaxis (NASDAQ:ABAX) is a leading Company in point-of-care blood analysis for both human and veterinary markets. 17% sales growth is forecasted for 2013 .
  • Cardiovascular Systems (NASDAQ:CSII) is a medical device Company focused in minimally invasive treatment of vascular disease. Revenues are forecasted to hit $97M in fiscal year 2013 giving the stock a low P/S of about 3. The stock will move much higher if profitability is achieved next year.
  • Our two turnaround candidates are Alere (NYSE:ALR) and Response Genetics (NASDAQ:RGDX), our only two underperformers but both have very attractive valuations as measured by Price/Sales.
  • Illumina (NASDAQ:ILMN) up 82% YTD after an earnings miss but rallying on a Roche bid that was turned down by the Company. Rumors on a new buyout have resurfaced.The Company is a leader in genomics tools and DNA sequencing.
  • ThermoFisher (NYSE:TMO) is a new buy at $53.50 and is up over 20% since JY 25. The Company is a core life science research tools play and moving aggressively into clinical diagnostics with revenues over $12B.
  • Quidel (NASDAQ:QDEL) was a recently reiterated buy based on new product sales for infectious disease diagnostics such as C. difficile, Flu and Legionella.
  • Cepheid (NASDAQ:CPHD) is a new buy at $31.40 in October for an earnings turnaround is a leader in molecular diagnostics.
  • Neogen (NASDAQ:NEOG) stock is up 48% over one year and is a core small cap holding with diagnostic products for food and animal testing.
  • ExactSciences (NASDAQ:EXAS) and Sequenom (NASDAQ:SQNM) are emerging technology plays in genetic analysis for clinical testing.
 

 

2012-2013   Original Price Price %   Price Price % RET    
    Recomm   Dec'10 Ret   10/2/12 1/2/13 1 yr    
                       
Abaxis ABAX 2/2/09 15 26.85 79   37.9 37.8 36.7    
CardioV.Sys. CSII 11/5/10 7.15 11.66 63   11.45 13 29.7    
Celera CRA 3/28/10 7 6.3 18   acquired        
Cepheid CPHD 10/23/12 31.4       NEW 35.5 13    
Exact Sci EXAS 12/10/10 5.6 5.98 6.8   11.36 11 36    
GenProbe GPRO 2/2/09 45 58.35 30   82.55 acquired    
Illumina ILMN 2/2/09 29 63.34 118   51.2 55.4 81.8    
Immucor BLUD 4/5/10 20 19.83 0   acquired        
Alere ALR 2/2/09 25 36.6 46   19.64 19 -17.7    
MicroFluidics MFLU 7/6/10 0.77 1.34 74   acquired        
NeoGen NEOG 7/2/10 26 41.03 58   42.8 45.6 48.8    
Qiagen QGEN 3/15/10 21.5 19.55 -9   19 18.8 36    
Quidel QDEL 6/16/10 12.4 14.45 16   18.65 19.9 31.3    
ResponseG RGDX 2/3/12 1.5 NEW     1.3 1.4 -12.9    
Sequenom SQNM 11/18/09 3.75 8.03 114   3.5 4.93 10.8    
SeraCare SRLS 11/18/09 2.75 4.75 73   acquired        
ThermoFish TMO 7/25/12 53.5 NEW     59.4 65 44.5    
                       

Disclosure: I am long CPHD, CSII, ILMN, QDEL, RGDX.

Stocks: CPHD, ILMN, NEOG, QDEL