Stock Alert for Complete Genomics Inc. (GNOM)
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    Stock Alert for Complete Genomics Inc. (GNOM)

    Stock Alert for Complete Genomics Inc. (GNOM)

    Complete Genomics Inc. (GNOM) is a life sciences company that has developed and commercialized an innovative DNA sequencing platform that it believes will become the preferred solution for complete human genome sequencing and analysis. The Complete Genomics Analysis Platform, or CGA™ Platform, combines the Company’s proprietary human genome sequencing technology with its advanced informatics and data management software.  GNOM offers this solution as an innovative, end-to-end, outsourced service and provide customers with data that is immediately ready to be used for genome-based research. Its CGA™ Service solution provides academic and biopharmaceutical researchers with complete human genomic data and analysis at an unprecedented quality, cost and scale. GNOM generated revenue of $9.4 million for fiscal 2010, which compares to revenue of $0.6 million in fiscal 2009.

    Share Statistics (25-Jan-11) FY2009 FY2010 % Chg Q32010 Q32011 % Chg
    Symbol GNOM Revenue, $Mn 0.62 9.39 1414.5% 4.16 4.18 0.5%
    Current price $2.99 Gross marg. -711.3% -111.9% -84.3% -44.5% -95.7% 115.1%
    52wk Range: $2.21-$18.55 Oper. margin -507.5% -498.4%
    Avg Vol (3m): 452,663 Net margin -5798.4% -614.4% -89.4% -491.8% -517.0% 5.1%
    Market Cap. 99.21M
    Shares Outstanding 33.18M EPS, $ -386.56 -13.60 -96.5% -21.87 -0.65 -97.0%

    Source: Reuters.com, SEC Filings.

    Investment Highlights

    Shares of Complete Genomics Inc. (GNOM) advanced as much as 32% to $3.30 in Wednesday’s trading, stretching gains for the third straight trading session.  Over 3.66 million shares exchanged hands during the day, versus the 10-day average of over 777 K. The stock has a 52-week range of $0.82 – $6.38. It is currently trading above  its 50-day moving average of $2.92 and below its 200-day moving average of $6.47.

    Shares of GNOM have gained 18.7% in the last five days and 4.9% in the last month.  Year-to-date, the stock is down 82.2%.

    GNOM last week announced that the Journal of Computational Biology, a peer-reviewed scientific journal dedicated to computational biology and bioinformatics, has recently published online the Company’s paper describing some of the computational methods that enable it to produce highly-accurate whole human genome sequencing data.

    Mountain View, CA-based GNOM performs whole human genome sequencing using proprietary biochemistry based on DNA nanoball arrays and combinatorial probe-anchor ligation sequencing. As these methods produce reads with unique characteristics, the Company has developed new methods that call single nucleotide polymorphisms (SNPs), short substitutions and insertions/deletions, GNOM said in statement.

    The paper can be viewed at http://www.liebertonline.com/doi/full/10.1089/cmb.2011.0201

    “The methods described in this paper produce very accurate variant calls,” commented Dr. Clifford Reid, chairman, president and CEO of GNOM. “The algorithms described in this paper have been used for all of our 69 genome public data repository and the more than 3,800 complete, deeply sequenced human genomes we have delivered to customers to date.”

    GNOM’s genome data repository can be accessed for free at http://www.completegenomics.com/sequence-data/download-data/

    GNOM shareholders earlier this month welcomed the news that the company delivered about 3,000 genomes to its customers in 2011 and is entering the new year with contracts for about 5,800 genomes.

    During the last three months of last year, GNON delivered more than 600 genomes to its customers, trailing its projection of 900 genomes.  According to the Company, nearly 300 genomes took longer to move through the pipeline than anticipated and will ship in the first quarter of 2012.

    GNOM last year secured orders for about 8,000 genomes worth approximately $39 million.

    Source: http://www.completegenomics.com/news-events/press-releases/

    Financial Summary

    GNOM reported revenue of $4.2 million for the quarter ended September 30, 2011, unchanged from revenue reported in the third quarter of the prior year.  The Company recognized revenue for over 700 genomes compared to over 300 genomes recognized in the third quarter of 2010.

    Costs and operating expenses were $25.0 million compared to $14.9 million in the third quarter of 2010.

    GNOM realized a net loss of $21.6 million for the quarter.  That compared to a net loss of $20.5 million in the comparable quarter of the prior year, which included an $8.8 million non-cash expense resulting from the accounting adjustment to market value of certain equity securities.

    The Company’s backlog as of September 30, 2011, was approximately $24 million and 4,800 genomes. It ended the third quarter of 2011 with $105.1 million in cash, cash equivalents and short-term investments.

    Source: http://www.completegenomics.com/news-events/press-releases/Complete-Genomics-Reports-Results-for-Third-Quarter-2011-133456158.html

    Financial Strength (25-Jan-2012)

    Company

    Industry

    Sector

    S&P 500

    Quick Ratio (MRQ) 4.96 3.16 1.98 0.71
    Current Ratio (MRQ) 5.11 3.98 2.54 1.09
    LT Debt to Equity (MRQ) 17.94 30.87 35.97 96.19
    Total Debt to Equity (MRQ) 22.96 35.12 48.02 135.12
    Interest Coverage (TTM) -4.64 10.43 1.44 27.03

    Source: Reuters.com, SEC Filings.

    Technical Analysis

    Source: http://stockcharts.com

    GNOM is within its Bollinger Bands. This is a normal condition suggesting that it is neither overbought nor oversold relative to the recent levels.

    The MACD for GNOM currently indicates a strong bearish signal for two reasons. First, the MACD is below the signal line, a 9-day moving average. Second, the MACD is below the critical level of 0, which implies that the underlying moving averages are trending lower.

    Comparative Analysis

    Company Name Ticker Price per Mrkt. Cap. P/E P/S
    Jan25-2011 symbol Share, $ $ Mn 2011 2012 2011 2012
    Illumina Inc. ILMN 55.24 6.70B 44.91 39.18 6.38 6.04
    Life Technologies Corp. LIFE 49.21 8.72B 13.26 12.15 2.33 2.26
    Biotechnology Median       15.68 n/a 8.32 n/a
    Complete Genomics Inc. GNOM 3.01 99.21M n/a n/a 4.95 2.88

    Source: Thomson Financial

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