GH Stock Forecast & Price Target

Guardant Health, Inc. achieved a notable 30% year-over-year revenue growth in the fourth quarter, reaching $202 million, driven by strong clinical volumes that increased by 24% and biopharma volumes that rose by 16%. The company's adjusted gross margin stood at 63%, reflecting a 2-point improvement year-over-year, which is indicative of enhanced operational efficiency and favorable reimbursement conditions. Looking ahead, Guardant Health is poised for continued revenue expansion, with projections of approximately 15% year-over-year growth in oncology revenue, bolstered by favorable changes in coverage policies and elevated average selling prices that surpassed earlier targets.

Guardant Health is facing a negative outlook primarily due to slower-than-expected growth in its therapy selection franchise and weaker adoption of its molecular residual disease (MRD) test, Reveal. The company’s new colorectal cancer screening test, Shield, faces challenges, including not achieving advanced diagnostic laboratory test (ADLT) status and not being included in the U.S. Preventive Services Task Force (USPSTF) guidelines, which may limit its adoption rate and impact projected revenues, currently estimated at $25-30 million without the ADLT status assumption. Additionally, fluctuations in the average selling price (ASP) for Shield and increasing competition, along with difficulties in securing reimbursement for tests, further contribute to the uncertain financial outlook for Guardant Health.