Adeza Biomedical Shares Ride Wave of Positive FDA News and Analyst Upgrade

SUNNYVALE, Calif. -- Shares of Adeza Biomedical Corp. jumped Monday on positive Food and Drug Administration news and an analyst upgrade from UBS, citing a survey of physicians and the company's cheap valuation.

The company, which focuses on developing reproductive tests and treatments, saw its stock rise $1.82, or 13.3 percent, to $15.51 in afternoon trading on the Nasdaq. The stock has traded between $11.16 and $23.35 over the last 52 weeks.

The FDA granted the company a priority review for its premature birth prevention treatment, Gestiva. The move means the FDA will decide whether to approve the treatment within six months, rather than the standard 10 months.

UBS analyst Benner Ulrich upgraded the stock to "Buy" from "Neutral" and reaffirmed a price target of $19, citing a survey of 96 OB-GYNs and the stock's valuation. In a survey of 96 physicians, he wrote in a note to investors, 71 percent are using tests to identify women at risk of delivering prematurely. Adeza's key product on the market is FullTerm, a test designed to determine such a risk.

"We estimate Adeza has only 45 percent to 50 percent of the symptomatic market and therefore we believe further penetration can fuel growth for the next two years," Ulrich wrote.

He also cited valuation, saying the risk-reward profile is more attractive because of recent weakness in the stock.

Shares of the company have fallen nearly 38 percent since their April 4 close of $22.02.