What's behind Exact Sciences' hot year? — 4 analyst insights

Eric Oliver - Print  |

Exact Sciences continues to have a strong year, which left one Motley Fool analyst asking, "Why?"

What you need to know:

1. The analyst attributes Exact's growth largely to the increased sales of Cologuard. Sales took off after Exact entered into a marketing and promotional partnership with Pfizer in 2018.

2. Those sales — as well as Exact's developmental work on liquid biopsy tests with Rochester, Minn.-based Mayo Clinic — have some analysts believing the company could be an acquisition target. However, its most likely suitor, Pfizer, recently made a $10.6 billion acquisition, which leads Motley Fool analysts to speculate that any acquisition talks are on hold.

3. Analysts believe Cologuard will pass $1 billion in sales in 2020, which is fueling the company's high valuation.

4. However, Exact's monopolistic grasp on the market, and in turn its valuation, could fall off if competitors succeed in bringing tests to the market.

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