Disclosures

Genomic Health, Inc

I, Laura McGuigan , certify that this report reflects my personal beliefs about this company and that no portion of my compensation was, is or will be directly or indirectly related to the specific recommendations or views discussed in this report.

Disclosure

  • B. Riley & Co., LLC does and seeks to do business with companies covered in its research reports.
  • A portion of this analyst’s compensation is based on the sales, trading and investment banking activities of B. Riley & Co., LLC.
  • B. Riley & Co., LLC makes a market in the securities of the company covered in this report.
Disclosure Chart

Initiated coverage on 10/04/2011 with a "Buy" rating and $27.00 price target.

Ratings Distribution as of May 17, 2012 % with Investment Banking Relationships
Rating Number of Companies Percent of Total Rating Number of Companies Percent of Total
Buy 112 73.7% Buy 13 100.0%
Neutral 37 24.3% Neutral 0 0.0%
Sell 3 2.0% Sell 0 0.0%
Total 152 100% Total 13 100%

Explanation of B. Riley & Co. LLC's Rating System

  • Buy: We generally expect "Buy" rated stocks to materially outperform both the S&P 500 and Russell 2000 as well as other stocks in their sector. Further, we believe that the potential reward relative to the potential risk is particularly attractive.
  • Neutral: We generally believe "Neutral" rated stocks will perform roughly in line with the S&P 500 and Russell 2000 over the intermediate and long term.
  • Sell: We generally expect "Sell" rated stocks to materially underperform both the S&P 500 and Russell 2000 as well as other stocks in their sector. Further, we believe that the potential reward relative to the potential risk is particularly unattractive.

Risks and Considerations

Additional Risks and Considerations

    • Acquisition/Integration - The company evaluates potential acquisitions as part of its growth strategy. Acquisitions pursued by the company could be dilutive to financial results and result in a difficult, dilutive or expensive integration.
    • Economy – Weak economic or business conditions may negatively impact the company’s business, as concerns over high unemployment levels, the availability and cost of credit, and other factors contribute to a slow recovery and lower economic growth expectations going forward.
    • Financial Results - The company has a history of operating losses, may incur net losses in the future. Although the Company is focused on achieving profitability, there are no assurances that the Company will meet its goals or be able to sustain profitability in future periods, as it expects to incur significant expenses to develop and market its tests.
    • Financial Results – If third-party payors, including managed care organizations and Medicare, do not provide reimbursement, breach, rescind, or modify their contracts or reimbursement policies or delay payments for the company’s tests, commercial success and financial results will be compromised.
    • General Industry – The company could miss our estimates and/or their financial guidance.
    • Growth Plan – There are many factors that may impact the company's ability to achieve its stated growth objectives.
    • Industry Change – The industry is subject to rapid technological change.
    • Intellectual Property – The company's business is dependent upon intellectual property (IP). Should the company fail to maintain its IP or should the Company infringe upon another's IP, financial results could be negatively impacted.
    • Legislation/Policy – Healthcare policy changes, including legislation reforming the U.S. healthcare system, may have a material adverse effect on the company’s financial condition and results of operations.
    • Loss of Key Personnel - In our opinion, the current management team will be instrumental in executing the company's growth strategy. The resignation of a key member of management would have a negative impact on the company.
    • Manufacturer/Supplier Dependency - The company relies on a limited number of key manufacturers/suppliers, and in some cases, a sole supplier. This lack of diversification could create interruptions in the company's supply of products and a corresponding loss of revenues.
    • Regulatory – The company is subject to complying with numerous regulations pertaining to its business, which is an expensive and time consuming process, and any failure to comply could result in substantial penalties.
    • Further Potential Risks – See the company's SEC filings, particularly its 10-K filing, for a discussion of further potential risks.