UBS analysts reiterated a Buy rating on Guardant Health (NASDAQ:GH) with a $40 price target, designating it as the firm’s top pick in the Life Sciences & Diagnostic Tools sector. The recognition is driven by Guardant’s robust growth prospects, particularly tied to the rising momentum of its Shield test for colorectal cancer (CRC) screening.

Guardant plans to begin reporting Shield CRC screening volumes with its fourth-quarter results, which could spotlight the test’s underappreciated market potential. A recent survey of 50 physicians revealed that blood-based CRC screening tests, such as Shield, could capture a 10% market share within the next 1-2 years—more than double what the market currently anticipates. This suggests a significantly larger commercial opportunity for Shield than previously forecasted.

Additional catalysts are expected to further enhance Shield’s market position, including potential pricing improvements and favorable updates to medical society guidelines. Concerns about competition from Exact Sciences’ upcoming blood-based CRC screening data, anticipated in the second quarter, appear overstated according to UBS.

Beyond Shield, Guardant’s growth outlook is supported by its Reveal test for minimal residual disease (MRD), which is expected to gain expanded Medicare reimbursement by the first half of 2025.