Explaining his $70 shift Shulman writes, "…no, I didn't have too much to drink while watching the baseball playoff games." He bases his call on the uptake of Cepheid's test for hospital staph infections which is rolling out in Veterans Administration hospitals. The test is also being required upon hospital admission in a few states and Shulman believes that within five years every hospital will be doing it. He writes, "…and that my friends is a $1.4 BILLION (the caps are his emphasis) opportunity!"
But Shulman claims that's not the main reason for his bullishness. He cites comments made at an investment conference last week where Cepheid said it's working on microRNA. That's the technology that Alnylam and Isis Pharmaceuticals recently formed a joint venture to explore. Shulman believes that eventually Cepheid could develop a way to do a blood test for solid-tumor cancers which he calls a "multi-billion dollar opportunity".
He is pounding the table on the stock. "Get in now, don't wait," he writes. "I see this stock currently around $24, hitting that $110 target price in three to five years. Wall Street is unaware of the microRNA and cancer diagnostics potential of Cepheid, but it is becoming more aware every day."
As a general rule, I wouldn't blog about a price target increase by an analyst. But like the $700 number for GOOG, $110 for CPHD is eye-catching.
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