OBJECTIVES: Lower respiratory tract infections (LRTIs) are a significant cause of mortality in immunocompromised patients. Next generation sequencing methods may improve diagnostic performance relative to a panel of targeted molecular diagnostic tests and cultures (PANEL) for detection of microorganisms from bronchoalveolar lavage (BAL); however, the relative cost-effectiveness is unknown. The objective of this study was to determine the cost effectiveness of NGS relative to PANEL for detection of respiratory infections in BAL specimens. METHODS:  We built a decision tree to assess 30-day costs and mortality per patient tested in a population of hospitalized immunocompromised patients with suspected LRTI. Outcomes were compared in BAL specimens tested with NGS and PANEL. Inputs were identified from literature sources or expert opinion. Probabilistic sensitivity analysis was performed using the 20 variables that had greatest influence from a one-way sensitivity analysis. We tested two scenarios: 1) a base case in which we assumed the costs of the tests were the same 2) a test case in which we determined the cost difference at which NGS testing would be acceptable at a willingness-to-pay threshold of $50,000 per life saved. RESULTS: The base case analysis (assuming testing costs of NGS and PANEL were the same) showed that NGS had lower costs with no mortality difference compared to the PANEL over the 30 days ($19,460 and 88.99% survival vs. $19,551 and 88.86% survival per patient tested, respectively). The incremental cost-effectiveness ratio (ICER) for the NGS vs. PANEL reached $50,000 per life saved when the cost of the NGS test was $154 greater than PANEL, or if the specificity of NGS was 1% lower than PANEL. NGS achieved 66 and 75% likelihoods of being cost-effective at willingness to pay thresholds of $0 and 50,000, respectively. CONCLUSIONS:  NGS-based testing is most likely cost-effective compared to PANEL for testing immunocompromised patients with symptoms of LRTI.