GH Stock Forecast & Price Target

Guardant Health has reported a robust performance with a 31% year-over-year revenue growth for 2024, driven by strong clinical and biopharma test volumes. The company achieved an adjusted gross margin of 63%, reflecting a two-point increase year-over-year, and also saw its Guardant360 average selling price exceed $3,000, achieved four years ahead of its initial target due to favorable reimbursement trends. Looking forward, Guardant Health's oncology revenue is anticipated to grow approximately 15% year-over-year, supported by significant increases in testing volumes and improved reimbursement rates, including an increase in the Medicare rate for Guardant360 from $3,500 to $5,000.

Guardant Health faces significant challenges that contribute to a negative outlook, primarily due to slower-than-anticipated growth in its therapy selection franchise and weaker adoption rates for its molecular residual disease test, Reveal. The company’s new colorectal cancer screening test, Shield, not only risks failing to achieve advanced diagnostic laboratory testing (ADLT) status but is also not included in the U.S. Preventive Services Task Force (USPSTF) guidelines, which could hinder market penetration and adoption. Additionally, despite expectations of reduced costs of goods sold (COGS) for Shield in the long term, potential pricing pressure indicated by a decrease in average selling price (ASP) and uncertainties surrounding reimbursement further complicate the financial outlook for Guardant Health.