Shares of NeoGenomics (NEO, Financial) plunged 34.9% following the release of its first-quarter 2025 earnings report, which failed to meet Wall Street's sales expectations. The stock is currently trading at $6.49.
Despite the earnings miss, NeoGenomics increased its full-year revenue guidance, although its decision to maintain the full-year EBITDA guidance suggests potentially lower-than-anticipated profit margins. On a positive note, the company surpassed analyst EPS expectations, and its full-year revenue guidance exceeded Wall Street estimates.
NeoGenomics operates within the Medical Diagnostics & Research industry, providing oncology diagnostic testing and consultative services. However, it faces challenges such as a declining gross margin, 43.92%, which has been on a long-term decline by an average rate of 1.5% per year, and an Altman Z-Score of 1.24, indicating distress with a potential risk of bankruptcy in the next two years. This adds a layer of risk for investors.
The company has a market capitalization of approximately $834.99 million and an enterprise value (EV) of $1.50 billion. NeoGenomics scores a GF Value rating of "Possible Value Trap, Think Twice" with a GF Value of $16.90, suggesting it might be overvalued at its current price. For a detailed valuation, see NeoGenomics GF Value.
Investors should note the company's predictability score of 1 and its severe warning signs, including a gross margin decline, faster asset growth than revenue, and a distressed Altman Z-Score. Moreover, it operates with no P/E ratio due to negative earnings. Despite these challenges, NeoGenomics is deemed an unlikely manipulator, according to the Beneish M-Score.
