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Here's What Investors Liked About Bionano Genomics' Q1 Results

By Keith Speights - May 14, 2021 at 6:02AM

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The company delivered a pleasant surprise.

The frenzy that drove Bionano Genomics (BNGO -6.94%) stock to more than quintuple earlier this year has largely evaporated. However, Bionano's share price is still up more than 50% year to date. And there's reason to think that a rebound is imminent.

Bionano announced its first-quarter results after the market closed Thursday. Investors seemed to like what they heard, with the life sciences stock jumping close to 9% in after-hours trading. Here are the highlights of Bionano's Q1 update.

A researcher in a genetics lab.

Image source: Getty Images.

By the numbers

Bionano reported revenue in the first quarter of $3.2 million, a 179% year-over-year increase. This result easily topped the consensus estimate of $2.9 million.

The company reported a Q1 net loss of $9.9 million based on generally accepted accounting principles (GAAP). In the prior-year period, Bionano posted a net loss of $10.5 million.

Bionano ended the first quarter with cash and cash equivalents of $362 million. This cash stockpile put the company in a much stronger position compared to the end of 2020 when it had cash and cash equivalents totaling $38.4 million.

Behind the numbers

The company achieved record sales primarily due to higher demand for its reagent rental program and consumables for its Saphyr genome mapping system. Its services revenue also grew, fueled by increased sales for Bionano's Lineagen subsidiary.

Bionano CEO Erik Holmlin said, "We sold a record number of flow cells, analyzed a record number of samples in our service lab, drove broad adoption of Saphyr instruments and ramped up the installation of Saphyr systems that weren't yet operational because of 2020's travel restrictions." He also noted that the company expanded into new geographical areas as well as into new applications including prenatal analysis, cancer research, and drug development.

Gross margin rose from 25% in the prior-year period to 33% in the first quarter of 2021. This solid increase stemmed mainly from a product mix shifting to consumables and services that have higher margins.

Bionano's larger cash stockpile resulted from its two equity raises earlier this year. CFO Chris Stewart said that the company's financing transactions "solidified our foundation for growth."

Looking ahead

Several potential catalysts are on the way for Bionano. The company expects to receive accreditation of its Saphyr-based laboratory-developed tests for acute lymphocytic leukemia and facioscapulohumeral muscular dystrophy in certain European markets this quarter. It plans to launch prenatal assays and expand its menu of pediatric assays in the third quarter.

By the end of this year, Bionano thinks that it will have an installed base of 150 systems, a 50% increase from the end of 2020. Investors will disagree as to whether or not this outlook is enough to buy the stock. For now, though, it looks like the company's Q1 performance might attract more attention for the stock than it's had in recent weeks.

Keith Speights has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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