Why Sequenom Inc. Shares Soared

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of genetic analysis company Sequenom (NASDAQ: SQNM  ) surged 24% today after its quarterly results topped Wall Street expectations.

So what: Sequenom plummeted last week on further patent litigation headaches, but a third-quarter revenue spike of 92% suggests that management's turnaround initiatives are gaining traction. While the company lost $28.1 million during the quarter, significantly improved collections are quickly easing concerns over its liquidity position.

Now what: Management expects cash burn to continue trending downward as its collections and revenue improve with expanded offerings.

"We began to report [in October] the presence of subchromosomal microdeletions and autosomal trisomies for chromosomes 16 and 22," said Chairman and CEO Harry Hixson, Jr., Ph.D. "This expansion of the MaterniT21 PLUS test, as part of our Enhanced Sequencing Series, is the result of our continued investment and further validates the importance and value of our pioneering NIPT testing services to health care professionals and their patients."

More important, with Sequenom shares still off about 60% from their 52-week highs, there might even be more room to rebound. 

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