With EU virus data picking back up and a number of major international companies beginning to warn about Covid-19 second-wave effects, investors need to prepare portfolios for a resurgence in virus impact headwinds.
That preparation will no doubt represent moves into vaccine, PPE, and testing stocks.
With that in mind, we take a look at several players in the space that could represent interesting ports in a potential coming storm, including: Lakeland Industries, Inc. (NASDAQ:LAKE), Allstar Health Brands Inc (OTCMKTS:ALST), Alpha Pro Tech, Ltd. (NYSEAMERICAN:APT), and Quest Diagnostics Inc (NYSE:DGX).
Lakeland Industries Inc (NASDAQ:LAKE) is one of the pure-play options for investors looking to gain exposure to virus preparation. The company manufactures and sells industrial protective clothing and accessories for the industrial and public protective clothing market worldwide.
It offers limited use/disposable protective clothing, such as coveralls, laboratory coats, shirts, pants, hoods, aprons, sleeves, arm guards, caps, and smocks; high-end chemical protective suits to provide protection from highly concentrated, toxic and/or lethal chemicals, and biological toxins; and firefighting and heat protective apparel to protect against fire, burns, and excessive heat.
Lakeland Industries Inc (NASDAQ:LAKE) just recently announced financial results for its fiscal 2021 second quarter ended July 31, 2020, including net sales for 2Q21 of $35.0 million, up 27.5% as compared with 2Q20 of $27.5 million, gross profit for 2Q21 of $17.3 million, compared with 2Q20 of $10.4 million, and gross margin as a percentage of net sales in 2Q21 of 49.5%, compared to 37.9% in 2Q20.
Charles D. Roberson, President and Chief Executive Officer of Lakeland Industries, stated, “Our Company has just set a new standard of excellence for PPE manufacturers anywhere in the world. Following our fiscal 2021 first quarter that was extraordinary with record setting financial results, we just exceeded that as measured by key performance measures. Against a backdrop of very challenging times, I am very proud of the efforts and achievements of our global team. We are delivering for our existing and new customers alike, our shareholders, and, perhaps most importantly, for the health and safety of people around the world as we all contend with the continued COVID-19 pandemic.”
Even in light of this news, LAKE has had a rough past week of trading action, with shares sinking something like -3% in that time. That said, chart support is nearby, and we may be in the process of constructing a nice setup for some movement back the other way.
Lakeland Industries, Inc. (NASDAQ:LAKE) pulled in sales of $35M in its last reported quarterly financials, representing top line growth of 27.5%. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($34.9M against $17.1M).
Allstar Health Brands Inc (OTCMKTS:ALST) has powered into the diagnostic and antibody testing space as well as the PPE marketplace this year, with one of its most interesting recent strategies involved in the development and distribution of the QuickLAB module, a rapid testing solution for Covid-19 pushed toward the market in partnership with TPT Global Tech, a technology and solutions company.
The company believes that, given the high Covid-19 infection rates around the world, and the ability to set up the QuikLAB testing modules at almost any location, the QuikLAB option may be part of the solution in combating the effects of this pandemic.
Allstar Health Brands Inc (OTCMKTS:ALST) most recently announced that it is also entering into a Partnership Agreement for Sales and Marketing with an eCommerce Group with its own Merchant Processing, Fulfillment Center (Distribution) and Digital Marketing infrastructure.
Dr. Daniel Bagi, President of AllStar observed,” This is a key strategic milestone for AllStar as we can now combine our unique, high-value product portfolio with our partner’s existing online infrastructure including merchant accounts, digital marketing and fulfillment enabling us to reach customers all across the US and Canada. We are starting the process of integrating the first wave of AllStar’s products into the existing infrastructure. Once integrated we expect both companies to add to their revenue base with novel high-margin health care products in Women’s Health and other under-served health segments. Many companies involved in e-commerce market their own brand (white-labelled) of common health supplements and compete with similar products from other companies. By adding our novel products to the existing legacy products we expect to grow revenues and increase profit margins.”
Looking ahead, AllStar says it plans to provide several options for FDA, EUA-approved rapid Covid-19 anti-body tests, and PCR tests for the TPT Medtech QuikLab modules. This could make its QuickLAB module a kind of one-stop-shop solution for communities with less than adequate testing supplies anywhere in the western hemisphere now that its partnership extends through the US and Canada.
Allstar Health Brands Inc (OTCMKTS:ALST) is surely a more speculative name on this list. But with the company’s recent expansion and partnerships, it may also be the most interesting. Naturally, due diligence is critical.
Alpha Pro Tech Ltd (NYSEAMERICAN:APT) sells disposable protective apparel, building supply products, and infection control products in the United States and internationally. The big idea powering the stock lately is its products of masks capable of helping to prevent the spread of COVID-19.
The company operates through three segments: Building Supply, Disposable Protective Apparel, and Infection Control. The company distributes its products through a network of purchasing groups, distributors, and independent sales representatives, as well as through its sales and marketing force.
Alpha Pro Tech Ltd (NYSEAMERICAN:APT) most recently announced financial results for the three month period ended June 30, 2020.
Lloyd Hoffman, President and Chief Executive Officer of Alpha Pro Tech, commented, “Alpha Pro Tech delivered another exceptional quarter with triple-digit organic revenue growth, a 123% increase compared to the second quarter of 2019. Gross profit margin was nearly 50%, which is above our historical average, due to a shift in product mix towards more personal protective equipment (PPE) and extremely strong cash flow. As a result of the ongoing COVID-19 pandemic, demand for our N-95 face masks and other PPE remains strong and shows no indications of slowing as we move into the second half of 2020. Our backlog of orders continues to increase with current delivery commitments into the second quarter of 2021.”
Even in light of this news, APT hasn’t really done much of anything over the past week, with shares logging no net movement over that period.
Alpha Pro Tech, Ltd. (NYSEAMERICAN:APT) managed to rope in revenues totaling $25.5M in overall sales during the company’s most recently reported quarterly financial data — a figure that represents a rate of top line growth of 123.4%, as compared to year-ago data in comparable terms. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($25M against $11.7M).
Quest Diagnostics Inc (NYSE:DGX) 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.
Quest offers diagnostic information services primarily under the Quest Diagnostics brand, as well as under the AmeriPath, Dermpath Diagnostics, Athena Diagnostics, ExamOne, and Quanum brands to patients, clinicians, hospitals, integrated delivery networks, health plans, employers, and accountable care organizations through a network of laboratories, patient service centers, phlebotomists in physician offices, call centers and mobile paramedics, nurses, and other health and wellness professionals.
Quest Diagnostics Inc (NYSE:DGX) just announced that individuals can now purchase a test to diagnose COVID-19 online, without visiting a doctor’s office, through QuestDirect, the consumer-initiated testing business of Quest Diagnostics (NYSE: DGX), the world’s leading provider of diagnostic information services.
According to the release, the QuestDirect COVID-19 Active Infection test* can be purchased online with specimen collection available in two ways: at-home or at one of more than 500 Walmart Neighborhood Market drive-thru pharmacy locations across the United States.
While this is a clear factor, it has been incorporated into a trading tape characterized by a pretty dominant offer, which hasn’t been the type of action DGX shareholders really want to see. In total, over the past five days, shares of the stock have dropped by roughly -3% on above average trading volume. All in all, not a particularly friendly tape, but one that may ultimately present some new opportunities. Over the past month, shares of the stock have suffered from clear selling pressure, dropping by roughly -6%.
Quest Diagnostics Inc (NYSE:DGX)) generated sales of $1.8B, 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 0.3% on the top line. In addition, the company is battling some balance sheet hurdles, with cash levels struggling to keep up with current liabilities ($988M against $1.8B, respectively).