Freenome is preparing for a significant expansion of its cancer-screening services, which Jefferies believes will enhance the company's market position. The investment firm has initiated coverage of Freenome with a 'buy' rating and established a price target of $17 per share, reflecting a potential upside of 47% from the stock's recent closing price.
Analyst Tycho Peterson highlighted that the broader commercialization of Freenome's services will begin this fall, opening multiple avenues for revenue generation, including royalties and milestone payments. Furthermore, Freenome plans to broaden its focus beyond colorectal cancer to include lung cancer and other types, which could further increase its market value.
The potential for more U.S. health insurers to reimburse cancer screening tests is also expected to drive demand for Freenome's services. Peterson noted that upcoming reimbursement catalysts, such as the American Cancer Society's guidelines for colorectal cancer screening, could unlock additional growth opportunities for the company.
Following Jefferies' positive outlook, Freenome's shares have already seen a 12% increase over the past three months, with a notable rise of over 7% after the coverage initiation