Exact Sciences (Nasdaq: EXAS) Cologuard isn't as precise as the developer's name would imply, but it looks to be good enough to get the job done.

The non-invasive colorectal cancer test detected 64% of samples from patients with pre-cancer polyps, and 85% of cancers in stool samples. The test looks for altered DNA from cancer cells that get shed into the stool.

That's probably not as good as a colonoscopy, but it provides a good alternative for the 40% of people over the age of 50 who should get a colonoscopy, but don't because ... well ... let's just say I hear they aren't much fun.

The test had a specificity of 88%; in short, 12% of the samples it called positive didn't actually have a sign of cancer. Again, that's not 100% exact, but since the patients with false positives would just go on to get an uncomfortable-but-generally-safe colonoscopy to confirm the test, a false positive rate in that range is more than acceptable.

How well could Cologuard sell? There's no real competition, and insurance companies UnitedHealth Group (NYSE: UNH), Humana (NYSE: HUM), and Aetna (NYSE: AET) would gladly pay for the test rather than have to pay for costly treatments if the colorectal cancer goes undetected. The limiting factor is probably getting people to take a stool test. While not many people over the age of two like playing with poop, patients may be willing to do it if they can avoid a colonoscopy.

But we're getting a little ahead of ourselves. Exact Sciences still has to run a clinical trial to confirm the results. These results came from frozen samples of well-characterized patients.

Exact Sciences opened down 14% today, but that may be mostly profit taking after a substantial run-up going into the data release. There's still some risk here -- witness Sequenom (Nasdaq: SQNM) for an extreme blowup of a test-maker -- but Exact Sciences isn't particularly expensive. If you're willing to wait for the test launch, the risk-reward looks good from here.