Oxford Nanopore Applied sciences (LSE:ONT) is an thrilling FTSE 250 inventory and is massively undervalued in accordance with analysts. Nevertheless, regardless of its groundbreaking expertise and up to date collaborations, the inventory has slumped. In contrast to lots of its friends, the hunch really has little or no to do with Donald Trump’s tariffs.

A DNA pioneer

For these unfamiliar, Oxford Nanopore is a pioneer in third-generation DNA sequencing expertise. The corporate’s units use nanopores — these are tiny protein-based constructions — to sequence DNA or RNA in actual time by detecting electrical modifications as molecules cross by way of these pores. This expertise is all out there on handheld units.

Its expertise is used throughout a number of fields, starting from infectious illness analysis to genomic surveillance in distant places. As an example, its units had been used in the course of the Ebola outbreak in 2015 to sequence viral genomes quickly.

Nevertheless, issues haven’t gone to plan since itemizing in late 2021. Oxford Nanopore’s share price has plummeted by over 80%, decreasing its market capitalisation to over £1bn. This dramatic decline stems from a mixture of things, together with persistent losses, heightened competitors, and macroeconomic challenges reminiscent of rising rates of interest. Analysts have additionally flagged issues about slower-than-expected development and a worsening funding atmosphere.

Analysts name this a ‘Strong Buy’

Regardless of the collapsing share price, analysts appear remarkably bullish. Of the ten analysts protecting the inventory, 4 have Purchase rankings and 4 have Outperform rankings. What’s extra, the typical share price goal is now 69% increased than the present share price. That is sometimes an excellent signal. By the way, the very best share price goal is 138% above the place we’re as we speak.

Nevertheless, shrewd buyers might want to query this name. The corporate’s working loss has almost doubled to £152m since 2019, and the forecast suggests it received’t attain adjusted EBITDA breakeven till 2027. For 2025, analysts anticipated unfavorable earnings per share (EPS) of 15.9p. That’s not insignificant for inventory valued at 114p per share.

The saving grace is the web money place which at the moment stands at £292m and is ready to fall to £158m by the top of 2026 based mostly on the forecast. Which means it does have some runway till its long-awaited profitability.

In fact, it might not attain profitability in its present state. Ongoing losses and a falling share price have made the inventory weak, with some suggesting it might change into a takeover goal for bigger gamers like Thermo Fisher Scientific or Danaher.

The underside line

On 9 April 2025, Oxford Nanopore introduced a strategic collaboration with Cepheid to develop automated sequencing options for infectious illnesses. The might increase into different areas like most cancers diagnostics and human genetics, doubtlessly opening new income streams.

Nevertheless, buyers ought to be cautious that Oxford Nanopore is a basic high-risk, high-reward funding. Its progressive expertise and strategic collaborations place it effectively for future development, however I’m reluctant to throw my very own cash behind it. Nonetheless, I’ll proceed to maintain a detailed eye on developments.