Citron says low value of Exact Sciences' purchase Cologuard-associated biomarker supports bearish view; shares ease 1%

• Noted short seller Citron Research publishes another piece on CRC test provider Exact Sciences (EXAS -1.4%) that it believes reinforces its $20 (36% downside risk) near-term price target.
• Citron cites the company's quiet announcement that it purchased the rights to a DNA methylation biomarker called NDRG4, which serves as the basis for Cologuard, from MDX Health for $8M. Based on analysts' views for revenue through 2019, however, the true value of NDRG4 to MDX should be $32M - 34M based on a 3% royalty rate.
• Citron says either one of the two parties is incredibly stupid or the deal fairly values the biomarker, the logical assumption. If so, someone's numbers are wrong.
• Previously: Citron bearish on Exact Sciences, sees single-digit valuation; shares off 6% (May 15)