Zacks Investment Research downgraded shares of Cepheid Inc (CPHD) from NEUTRAL to UNDERPERFORM on August 06, 2013, with a target price of $33.00.
Cepheid reported a weak second-quarter with adjusted loss of $0.08, wider than the Zacks Consensus Estimate of loss of $0.03 and year-ago EPS of $0.03. Revenue rose 19% to $96 million, ahead of the Zacks Consensus Estimate of $93 million. While overseas growth was encouraging, weakness in the North American market was a downside. Although HBDC placements improved in the quarter, it led to gross margin downfall. The updated 2013 guidance also failed to boost optimism. Also, the capital spending environment and competitive landscape for key products remain overhangs. We believe that any near-term improvement for Cepheid is an uphill task. As most of the headwinds that plague the company might persist for the rest of the year, we prefer to avoid the stock for the time being. Thus, we downgrade our recommendation on the stock to Underperform.
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