NEW YORK (AP) — Shares of genetic analysis technology company Affymetrix Inc. dropped Wednesday after an analyst said rival devices are making Affymetrix products “obsolete.”
Barclays analyst Charles Anthony Butler downgraded Affymetrix shares to “Underweight” from “Equal Weight,” and cut his price target in half, to $3 per share.
Shares of the Santa Clara, Calif., company sank 69 cents, or 11 percent, to $5.75 in afternoon trading.
Butler said the thinks “new technologies … are rapidly rendering the company’s products obsolete.” He said Affymetrix’s products are being challenged by newer technologies, including some that compete in Affymetrix’s primary market, gene expression analysis.
Affymetrix did not immediately respond to calls seeking comment.
Prices are coming down and rivals will release new products in the coming months, Butler wrote. He thinks its customers, which include research laboratories, won’t want to commit to new Affymetrix tools given the competition. He predicted larger losses for Affymetrix in the coming years.
In 2010, Butler expects the company to lose 21 cents per share with $331 million in revenue. On average, Thomson Reuters says analysts are forecasting a loss of 14 cents per share with $338.7 million in revenue.
Wall Street expects a profit of 10 cents per share in 2011, but Butler called for a loss of 39 cents per share.