Shares of Affymetrix Inc. plunged Friday after the company's second-quarter loss widened on lower revenue and the genetic analysis company cut its full-year outlook on a forecast for weaker sales to pharmaceutical companies.
The stock fell $2.93, or 28 percent, to $7.48 in afternoon trading, but traded at $7.25 earlier in the session, their lowest point in a decade.
"Affymetrix has had numerous missteps the last few years, and this is just another," said Deutsche Bank-North America analyst Ross Muken, in a note to investors. "The company's considerable weakness in the pharma market has put a continued drag on the stock, and we don't see any near-term recovery."
Late Thursday, the company reported a second-quarter loss of 5 cents per share on revenue of $86.9 million, both of which fell short of Wall Street expectations. The company said continued weakness in the pharma sector weighed down sales and it expects continued pressure.
Affymetrix lowered its full-year revenue guidance to between $455 million and $60 million, while analysts expect $393.6 million.
Muken said the company's new microarray genetic analysis system could help the company, but it is more likely Affymetrix will have to take serious steps to rebuild its customer and investor credibility. He downgraded shares to "Hold" from "Buy"
Meanwhile, Cowen and Co. analyst Doug Schenkel reaffirmed a "Neutral" rating, saying the outlook for the second half of the year might still be too high.
"Keep in mind that that first-half sales declined 5 percent, year-over-year, and second-half comparisons are tougher," he said.
Meanwhile, Lehman Brothers analyst Charles Butler reaffirmed an "Equal Weight" rating, saying the company is losing market share in the genetic research sector.
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