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The Virus Testing Boom is Upon Us (CODX, DGX, RXMD, LH)

Trump even said it himself on Tuesday: “It’s going to get worse before it gets better.”

We keep hitting new highs among coronavirus infections, hospitalization, and related deaths. New hot spots keep popping up. Mississippi appears to be the latest. The positivity rate in Arizona continues to be in the 20-40% range, which smacks of a dramatic invisible escalation there that could break per capita records in the near term. And Florida continues to look simply tragic, especially given the prevalence of highly at-risk age groups in that region.

But some companies are working hard to develop the tools and service strategies necessary to help us survive and eventually thrive. One of the most important features in that process is antibody testing, which helps to mark out the presence of our invisible shield. Testing has become big business in the process, with related stocks breaking out with strong gains in recent action. So active market participants may benefit from taking note.

Some of the most active and interesting names in the space include: Co-Diagnostics Inc (NASDAQ:CODX), Quest Diagnostics Inc (NYSE:DGX), Progressive Care Inc (OTCMKTS:RXMD), and Laboratory Corp. of America Holdings (NYSE:LH).

 

Co-Diagnostics Inc (NASDAQ:CODX) is a molecular diagnostics company that intends to manufacture and sell reagents used for diagnostic tests that function via the detection and/or analysis of nucleic acid molecules.  It also intends to sell diagnostic equipment from other manufacturers as self-contained lab systems.  Co-Diagnostics Inc (NASDAQ:CODX) recently announced that it is expected to join the Russell 2000® Index at the conclusion of the annual Russell US Indexes reconstitution after the close of equity markets on June 26, 2020.

Annual Russell indexes reconstitution captures the 4,000 largest US stocks as of May 8, 2020 ranking them by total market capitalization. Membership in the US all-cap Russell 3000® Index, which remains in place for one year, means automatic inclusion in the large-cap Russell 1000® Index or small-cap Russell 2000® Index as well as the appropriate growth and value style indexes. FTSE Russell, a leading global index provider, determines membership for its Russell indexes primarily by objective, market-capitalization rankings and style attributes.

If you’re long this stock, then you’re liking how the stock has responded to the announcement. CODX shares have been moving higher over the past week overall, pushing about 23% to the upside on above average trading volume. Shares of the stock have powered higher over the past month, rallying roughly 35% in that time on strong overall action. 

Co-Diagnostics Inc (NASDAQ:CODX) generated sales of $1.5M, according to information released in the company’s most recent quarterly financial report. That adds up to a sequential quarter-over-quarter growth rate of 1326.3% on the top line. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($17.4M against $1.2M).

 

Quest Diagnostics Inc (NYSE:DGX) promulgates itself as a company that provides diagnostic testing information and services in the United States and internationally. 

The company’s Diagnostic Information Services business segment develops and delivers diagnostic testing information and services, such as routine testing, non-routine and advanced clinical testing, gene-based and esoteric testing, anatomic pathology, and other diagnostic information services. Its Diagnostic Solutions segment offers risk assessment services for the life insurance industry; and health information technology solutions for healthcare organizations and clinicians. Quest Diagnostics Incorporated was founded in 1967 and is headquartered in Secaucus, New Jersey.

Quest Diagnostics Inc (NYSE:DGX) just announced that it has received emergency use authorization (EUA) from the U.S. Food and Drug Administration (FDA) to use specimen pooling with its proprietary molecular diagnostic test for COVID-19. Quest is the first lab provider to receive FDA authorization for the technique for COVID-19 testing in the United States.  

The context for this announcement is a bit of a bid, with shares acting well over the past five days, up about 5% in that timeframe.

Quest Diagnostics Inc (NYSE:DGX)  managed to rope in revenues totaling $1.8B in overall sales during the company’s most recently reported quarterly financial data — a figure that represents a rate of top line growth of -3.6%, as compared to year-ago data in comparable terms. In addition, the company is battling some balance sheet hurdles, with cash levels struggling to keep up with current liabilities ($342M against $1.1B, respectively).

 

Progressive Care Inc (OTCMKTS:RXMD) promulgates itself as “a personalized healthcare services and technology company”. Do a little digging and you find this is a company that has been showing strong top and bottom-line growth in the regional pharmacy services space, but is now increasingly set to expand operations into telemedicine, ecommerce, and a range of scalable growth strategies while maintaining its footprint in the Florida pharmacy services space.

The company has put up impressive numbers, with consolidated monthly gross sales across all locations during May totaling $3 million, representing year-over-year growth of 67%. It was 54% the month before, and 105% in March. And it was even better before the pandemic hit.

Progressive Care Inc (OTCMKTS:RXMD) has been one of the most aggressive forces for increased antibody testing services in the Florida market, recently announcing an expanded antibody testing regional footprint to include Palm Beach County. The Company’s antibody testing service has been met with extremely strong demand at its Dade and Broward County locations, depleting testing kit inventories by over 90% through sales and on-site test administrations.

In response to both this surge in demand and the expansion in regional coverage, the Company has ordered a large new supply of antibody testing kits for sale and administration across all four counties.

If you’re long this stock, then you’re liking how the stock has responded to the announcement. RXMD shares have been moving higher over the past week overall, pushing about 32% to the upside on above average trading volume. Shares of the stock have powered higher over the past month, rallying roughly 68% in that time on strong overall action. 

Progressive Care Inc (OTCMKTS:RXMD) generated sales of $9.1M, according to information released in the company’s most recent quarterly financial report. That adds up to a monthly year-over-year growth rate of 62% on the top line as of the Company’s last monthly performance update.

 

Laboratory Corp. of America Holdings (NYSE:LH) operates as an independent clinical laboratory company worldwide. It operates in two segments, LabCorp Diagnostics (LCD) and Covance Drug Development. 

It offers various clinical laboratory tests, such as blood chemistry analyses, urinalyses, blood cell counts, thyroid tests, Pap tests, hemoglobin A1C and vitamin D products, prostate-specific antigens, tests for sexually-transmitted diseases, hepatitis C tests, microbiology cultures and procedures, and alcohol and other substance-abuse tests. 

Laboratory Corp. of America Holdings (NYSE:LH) just launched the LabCorp At Home COVID-19 Test Collection Service, the first seamless digital service aimed at helping doctors protect patients by testing them for COVID-19 before surgeries and other important treatments. 

The service received Emergency Use Authorization (EUA) by the U.S. Food and Drug Administration (FDA) on July 1, 2020. The service enables a doctor to directly order a LabCorp At Home COVID-19 test collection kit for their patient through a digital interface with LabCorp.

The context for this announcement is a bit of a bid, with shares acting well over the past five days, up about 5% in that timeframe. Shares of the stock have powered higher over the past month, rallying roughly 19% in that time on strong overall action. 

Laboratory Corp. of America Holdings (NYSE:LH) managed to rope in revenues totaling $2.8B in overall sales during the company’s most recently reported quarterly financial data — a figure that represents a rate of top line growth of 1.2%, as compared to year-ago data in comparable terms. In addition, the company is battling some balance sheet hurdles, with cash levels struggling to keep up with current liabilities ($323.6M against $2.5B, respectively).

Published by Benjamin Roussey

Benjamin Roussey is from Sacramento, California. He has two master’s degrees and served four years in the U.S. Navy. His bachelor’s degree is from CSUS (1999) where he was on a baseball pitching scholarship. His second master’s degree is an MBA in Global Management from the University of Phoenix (2006). He has worked for small businesses, public agencies, and large corporations. He has lived in Korea and Saudi Arabia where he was an ESL instructor. Benjamin spends his time in between Northern California and Cabo San Lucas, Mexico, committing himself to his craft of freelance and website writing. http://www.facebook.com/ben.rouss



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