Cancer Genetics Inc (CGIX)

[tradeologist]

Looked into it and concluded

I believe your due diligence conclusion is flawed. You are about to be impaled by a falling knife. I agree with Zacks Strong Sell signal dated 1/6/16 for the following reasons:

1. The purchase of bankrupt Response Genetics, Inc. for $14M was a mistake. It will be very difficult to generate positive cash flow from those assets.

2. CGIX is predominately a laboratory testing services company, both clinical and biopharma. However, that core business continues to operate at a loss.

3. In 2014 the company, in an attempt to turn around its losses, created a new business unit dedicated to research and development of new proprietary genomic tests. I believe that was a strategic mistake and will become a major liability. That sort of research is better left to universities and startup companies focused solely on research.

4. To makeup for revenue shortcoming, the common stock has been diluted. My target price for 2016 is 50 cents.