What Happened?
Shares of genomics company Pacific Biosciences of California (NASDAQ: PACB) jumped 10.4% in the afternoon session after it received favorable reviews from Wall Street, with analysts raising their price targets following the company's strong second-quarter performance and promising strategic update. Piper Sandler boosted its price target to $1.50, and analysts at Bernstein SocGen Group followed suit, raising their target to $1.70 while maintaining an Outperform rating. Bernstein noted “promising signs of clinical uptake” for the company’s systems. This optimism follows Pacific Biosciences’ second-quarter results, where it beat estimates, posting revenue of $39.8 million, up from the previous year, and a narrower-than-expected adjusted loss. The positive performance is linked to a strategic pivot towards clinical and biopharma markets, which is driving strong global revenue growth and helping the company on its stated path to achieving cash flow positivity by 2027.
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What Is The Market Telling Us
PacBio’s shares are extremely volatile and have had 89 moves greater than 5% over the last year. But moves this big are rare even for PacBio and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 5 days ago when the stock gained 7.1% on the news that the company reported better-than-expected second-quarter 2025 financial results, beating revenue and earnings forecasts. The genomics company announced revenue of $39.77 million, a 10.4% increase year-over-year, which surpassed analysts' expectations by 7.6%. Its non-GAAP loss of $0.13 per share was also 21.5% narrower than anticipated. This performance was supported by a significant improvement in profitability, with the company's operating margin reaching negative 113%, a substantial improvement from negative 488% in the same quarter last year. The results suggest growing adoption of the company’s sequencing platforms, such as the Revio and Onso systems, which are used by researchers to analyze genomes with high accuracy.
PacBio is down 26.4% since the beginning of the year, and at $1.33 per share, it is trading 50% below its 52-week high of $2.65 from November 2024. Investors who bought $1,000 worth of PacBio’s shares 5 years ago would now be looking at an investment worth $236.19.
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