Guardant Health's Stock Declines Despite Positive Developments
Guardant Health Inc's stock has dropped 9.15% and hit a 20-day low amid a broader market decline, with the Nasdaq-100 down 2.33% and the S&P 500 down 0.93%.
Despite the stock's decline, recent news highlights significant positive developments for Guardant Health. The company achieved positive free cash flow in Q3 2025, ahead of its goal, and signed a multi-year collaboration with Merck to develop companion diagnostics. Additionally, Guardant360 CDx received FDA approval as a companion diagnostic for Pfizer's Braftovi and Eli Lilly's Erbitux, enhancing its competitive position in the oncology market. Investors remain optimistic about the company's future, although caution is advised.
The implications of these developments suggest that while the stock is currently under pressure, the positive financial performance and strategic collaborations could lead to a rebound in investor confidence and stock price appreciation in the long term.
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- Positive Financial Performance: Guardant Health achieved positive free cash flow in Q3 2025, one quarter ahead of its goal, indicating strong growth potential in its core oncology business, with expectations to maintain positive cash flow throughout 2026 and beyond, thereby boosting investor confidence.
- Strategic Collaboration Expansion: The company signed a multi-year collaboration with Merck to develop companion diagnostics and market new cancer therapies using Guardant's Infinity Smart program, further solidifying its market position in precision oncology.
- FDA Approval Milestone: Guardant360 CDx received FDA approval as a companion diagnostic for Pfizer's Braftovi and Eli Lilly's Erbitux in combination chemotherapy, marking its first FDA approval in colorectal cancer, enhancing the company's competitive edge in the market.
- Optimistic Market Outlook: Although the fourth-quarter financial results for 2025 have yet to be announced, investors maintain an optimistic view of Guardant Health's future, believing that the upcoming update could serve as a catalyst for stock price appreciation, although caution is advised against rushing into purchases in the short term.
- Stock Performance: Guardant Health's stock has surged over the past six months, currently priced at $110.48 with a market cap of $14 billion, reflecting strong market confidence in its future growth potential.
- Collaboration Agreement: The company has signed a multi-year collaboration with Merck to develop companion diagnostics and market new cancer therapies using Guardant's Infinity Smart program, further solidifying its leadership in precision oncology.
- Positive Cash Flow: In Q3 2025, Guardant's core oncology business achieved positive free cash flow ahead of schedule, with management expecting to maintain this trend throughout 2026 and beyond, indicating significant operational efficiency improvements.
- FDA Approval: Guardant360 CDx received FDA approval as a companion diagnostic for Pfizer's Braftovi, marking its first FDA certification in colorectal cancer, which, while not impacting Q4 results, lays a solid foundation for future growth.

- FDA Approval: Guardant Health's Guardant360 CDx has received FDA approval as a companion diagnostic for identifying patients with BRAFV600E-mutant metastatic colorectal cancer, marking a significant expansion in the company's precision medicine capabilities.
- Clinical Trial Support: The accelerated approval for Braftovi is backed by data from Pfizer's Phase 3 BREAKWATER trial, which demonstrated significant improvements in objective response rates and survival, likely boosting market demand for the associated therapies.
- Non-Invasive Testing Advantage: Guardant360 CDx is the first FDA-approved liquid biopsy that detects multiple genomic alterations through a simple blood draw, enhancing access to treatment for high-risk patients, particularly when tumor tissue samples are insufficient.
- Strong Financial Performance: Guardant Health anticipates revenues of $981 million in 2025, a 33% year-over-year increase, and analysts expect a slight improvement in earnings per share in the upcoming report, reflecting positive market sentiment regarding its growth prospects.

- FDA Approval: The US FDA has approved Guardant Health's Guardant360 CDx companion diagnostic, which determines which patients with BRAF V600E-mutant metastatic colorectal cancer could benefit from Pfizer's Braftovi (encorafenib), providing more precise treatment options for patients.
- Blood Test Advantage: Guardant360 CDx utilizes a small blood sample to detect genetic mutations, enhancing testing convenience and accelerating treatment decisions for patients, thereby improving survival rates and quality of life.
- Broad Market Potential: With the increasing demand for personalized medicine among colorectal cancer patients, this new diagnostic is expected to drive revenue growth for Guardant Health in the future and solidify its market position in precision medicine.
- Optimistic Performance Outlook: Guardant Health's revenue guidance for Q4 and FY25 exceeds market expectations, indicating strong performance in the healthcare services sector and further boosting investor confidence in its future growth.
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