Myriad Genetics Rises as Analyst Cites Test, Suggests Possible Acquisition
Myriad Genetics Inc., the maker of genetic tests that predict breast cancer risk, rose to its highest price in five months in Nasdaq trading after an analyst upgraded the company and said it may be an acquisition target.
Myriad rose $1.28, or 6.9 percent, to $19.94 at the 4 pm close of Nasdaq Stock Market composite trading, the highest value since May 4. Michael Yee, an analyst at RBC Capital Markets in San Francisco, boosted his rating on Myriad to “outperform” in a note today to investors that cited possible buyers. Chief Executive Officer Peter Meldrum said that the Salt Lake City-based company doesn’t want to be acquired.
Myriad’s test that identifies genes involved in some breast cancers will gain wider use from a new class of cancer drugs being developed, Yee said. He expects Myriad to reiterate its earnings projection for the year that started June 1 when it reports quarterly results Nov. 2. Roche Holding AG of Basel, Switzerland; London-based AstraZeneca Plc; and Paris-based Sanofi-Aventis SA all may be possible buyers, Yee said in the note.
“I think the shares have been beaten down, but sentiment is improving, and there are opportunities in the next six to 12 months that the street is underappreciating,” Yee said in a telephone interview. “Plus the stock is cheap.”
Myriad shares have declined 22 percent in the past 12 months.
Acquisition Not Sought
The company is not interested in being acquired, CEO Meldrum said in a telephone interview today.
“Our goal is to be a multibillion dollar company and become the global leader in the field of molecular diagnostics,” Meldrum said. “That is our vision and we want to do that on our own.”
Myriad gained 10 percent yesterday, a day after the company announced that its Prolaris test can predict whether men who underwent surgery for prostate cancer are likely to survive over a 10-year period. The test may identify men who should be treated aggressively and those who can be monitored and receive treatment only as needed, the company said in a statement.
While the Prolaris test is a small product today, it represents a “longer-term attractive opportunity,” Yee said.
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