Sequenom Earnings: Here’s Why the Stock is Falling Now

Sequenom Inc. (NASDAQ:SQNM) had a loss and missed Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 36.25%.

Sequenom Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share decreased to $-0.27 in the quarter versus EPS of $-0.26 in the year-earlier quarter.

Revenue: Rose 90.96% to $34.85 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Sequenom Inc. reported adjusted EPS loss of $0.27 per share. By that measure, the company missed the mean analyst estimate of $-0.19. It missed the average revenue estimate of $52.15 million.

Quoting Management: “We have managed through challenges associated with the tremendous growth in our business following the launch of MaterniT21 PLUS. Uncertainties associated with the newly introduced coding changes in the molecular diagnostics industry have impaired our ability to collect from payors during the first half of 2013. As with others in the industry, we believe that we should be paid for services already provided to patients in the first half of this year. Although the timing and magnitude of these payments is uncertain, we expect improvements in collections in the second half,” said Harry F. Hixson, Jr., Ph.D., Chairman and CEO of Sequenom. “We are taking actions to reduce costs and improve our overall financial performance, including curtailment of services for which there is no current reimbursement available.”

Key Stats (on next page)…

Revenue decreased 9.48% from $38.5 million in the previous quarter. EPS were the same at $-0.27 in the quarter as EPS of $-0.27 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a loss of $0.12 to a loss $0.14. For the current year, the average estimate has moved down from a loss of $0.79 to a loss of $0.80 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)