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Below is an excerpt from a complimentary research note by our Healthcare Team of Tom Tobin, William McMahon, and Justin Venneri. We are pleased to announce our new Sector Pro Product Health Care Pro. Click HERE to learn more. |
Natera ($NTRA) beat 4Q20 estimates and the upper end of the guidance range.
The guide is well ahead of consensus at over $500 million for 2021, which given the drivers appears to leave a number of upside levers to come in even better. Management announced the launch of Altera for comprehensive genomic profiling. Overall, we feel good about being on "Team Natera" this morning.
Signatera is targeting new cancers and NIPT is doing well. The top end of the guidance range at $525 million is right in line with our estimate, although given 4Q20 and the number of upside levers they described, we expect Natera will remain in a positive revision cycle. One highlight was the upside from Signatera which we have seen developing over the course of the quarter in our claims data.
The commentary about Altera, Signatera, and the commercial team build out completion all are consistent with our thesis and the upside over multiple years.
We believe Natera will emerge as a durable leader as multiple players converge on the genomic testing space.
For now, Natera is the leader in MRD and appears to have a clear development pathway to multiple cancers beyond their initial indication in colon cancer (see our most recent Field Notes).
While GH and others come to market with broad panels, we expect them and others to face a long ramp and Natera to enjoy a substantial period of rapid market adoption before those competitive dynamics kick in.
