Craig-Hallum upgrades CareDx to Buy, raises price target to $15

As previously reported, Craig-Hallum upgraded CareDx to Buy from Hold with a price target of $15, up from $12, after assuming coverage of the name. For the past 12 months, CareDx has been almost “uninvestable,” the firm says. Uncertainty around Medicare coverage and billing rules were a massive overhang. Revenue was declining and margins were contracting. The company had no CEO for nearly six months. But now the story is substantially de-risked, Craig-Hallum argues, as Medicare cuts are annualizing, guidance is conservative, the company has $235M of cash and marketable securities and no debt, which is more than enough to get to cash flow breakeven. Further, there is a new CEO who seems to be focused on all the right things, adds the firm.