Shares of NeoGenomics (NEO -4.14%) jumped 53.9% this week, according to data from S&P Global Market Intelligence. The cancer diagnostic company's stock closed last Friday at $7.31 a share and then opened on Monday at $7.41. It rose throughout the week and hit its weekly high at $11.39 on Friday, though it closed the week a little lower at $11.25. The stock is still down more than 67% so far this year and has a 52-week low of $6 and a 52-week high of $43.29.
The company has a network of laboratories that run genetic cancer screenings for oncologists, hospitals, and pathologists. It is in the midst of a turnaround plan, announced as Project Catalyst this past summer, which involves adopting automation into the company's lab processes. The company also has a new CEO, Chris Smith, who took over this summer.
NeoGenomics reported third-quarter numbers on Tuesday that showed its turnaround seems to be headed in the right direction. The company reported revenue of $129 million, up 6% year over year. The biggest percentage gain was in its pharma services segment, which had $23 million in revenue, up 18% over the third quarter of 2021. Clinical services revenue was $106 million, up 4% year over year.
The company is still losing money, as it reported a net loss of $37 million, compared to a loss of $20 million in the third quarter of 2021. The company said the prior-year's numbers included an $18 million gain on prior investments.
Still, the strong quarter was encouraging considering NeoGenomics is located in Fort Myers, Florida, which was hit hard by Hurricane Ian in September, during the quarter.
The healthcare company posted an adjusted gross margin of 41.7% in the quarter, the third consecutive quarter it has improved adjusted gross margin, as it focuses on more profitable projects and customers. Investors are seeing progress. It may be a simple situation where cancer screenings were down during the height of the COVID-19 pandemic as people without the virus stayed away from doctor's offices and now that dynamic is changing back to normal. The script also changed a bit this week for biotech companies as lower inflation numbers drove up the market in general, but especially for beaten-down tech companies.