Yesterday was a rough day for risk assets after Germany announced an Easter lockdown to avoid a new acceleration in Covid-19 cases and deaths. The measures are a response to recent worrying signs of trouble in the EU in terms of vaccine distribution.
New variants and unexpected case increases have everyone back on alert. In response, stocks and oil tumbled and bonds were bid higher with the dollar.
This morning, some interesting stocks with direct ties to the virus testing theme are out with important headlines that could fuel the trading day, including: Thermo Fisher Scientific Inc (NYSE:TMO), Allstar Health Brands Inc (OTCMKTS:ALST), and Laboratory Corp of America Holdings (NYSE:LH).
Thermo Fisher Scientific Inc (NYSE:TMO) bills itself as the world leader in serving science, with annual revenue exceeding $30 billion. The company states its mission is to enable our customers to make the world healthier, cleaner, and safer.
It has a global team of more than 80,000 colleagues that it claims delivers an unrivaled combination of innovative technologies, purchasing convenience, and pharmaceutical services through its industry-leading brands, including Thermo Scientific, Applied Biosystems, Invitrogen, Fisher Scientific, Unity Lab Services and Patheon.
Thermo Fisher Scientific Inc (NYSE:TMO) will be trading today on news that it has just announced the launch of a nationwide testing program designed to support U.S. efforts to return to in-person classroom instruction. This program, developed in partnership with Color Health, Inc., a California-based leader in distributed healthcare services, along with leading providers of laboratory testing, aims to support schools as the Biden Administration provides $10 billion in funding to conduct COVID-19 testing.
“The $10 billion allocation is a critical first step to returning students to school in April, and what happens next is even more critical – helping schools take advantage,” said Mark Stevenson, executive vice president and chief operating officer of Thermo Fisher Scientific. “This program is possible because our industry has already established a strong testing infrastructure during the pandemic and now it’s time to make that available where it’s needed most urgently.”
Even in light of this news, TMO hasn’t really done much of anything over the past week, with shares logging no net movement over that period.
Thermo Fisher Scientific Inc (NYSE:TMO) managed to rope in revenues totaling $10.6B in overall sales during the company’s most recently reported quarterly financial data — a figure that represents a rate of top line growth of 54.5%, 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 ($10.3B against $10.3B).
Allstar Health Brands Inc (OTCMKTS:ALST) is most speculative name in this basket, but it may also end up being the stock with the greatest upside potential simply because it is the least well known and likely has seen the least interest to date.
One of ALST’s core assets at this point is its partnership with TPT Global Tech, a technology and solutions company. The two companies are collaborating to create and distribute the QuickLAB module, a rapid testing solution for Covid-19. The two companies had already recently signed an agreement for Mexico and other Latin American countries through TPT Global Tech’s partner New Orbit Technologies. Now, they have signed an expanded agreement to bring QuickLAB distribution to Canada and US to add to the existing Non-Exclusive Distribution Agreement for Mexico and other Latin American countries.
Allstar Health Brands Inc (OTCMKTS:ALST) just updated current and prospective shareholders this morning on the status of the Company’s Covid-19 testing project in Jamaica, as well as its outlook for testing volume at major Jamaican testing sites.
“Together with our partner, TPT Medtech, we are successfully onboarding the ‘QuikPASS’ and ‘QuikLAB’ systems at Jamaica’s two main international airports: Montego Bay and Kingston,” noted Dr. Daniel Bagi, CEO of AllStar Health. “As our operations in Jamaica ramp up, we expect to test up to 3,000-5,000 travellers per day, amounting to a potential several million tests annually at these locations.”
According to its release, the CDC recently mandated that all travellers coming back into the US, UK, or Canada from the Caribbean, Mexico, or Latin America must be tested before arrival. Moreover, all travellers must obtain PCR test results for travel to the UK or Canada. To gain clearance to travel, travellers from Jamaica heading to destinations within the UK, US, Canada, or other countries may utilize “QuikPASS” (or other available Covid-19 passport apps) or get tested at any approved facility and show a negative Covid-19 laboratory test result at the airport in the form of written documentation (electronic or printed).
Dr. Bagi added, “We are very pleased to be able to install these systems with our partner TPT MedTech. This will enable us to help provide an advanced system for testing and reporting of Covid-19 diagnostic status, which we expect will be a factor in restoring the tourism industry in a country where tourism makes a critical contribution to overall GDP.”
Allstar Health Brands Inc (OTCMKTS:ALST) generated sales of $178K, 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 224.2% on the top line. ALST is surely a more speculative name on this list. But with the company’s recent expansion and partnership, it may also be the most underpriced.
Laboratory Corp. of America Holdings (NYSE:LH) is another stock that has started to power higher over recent days as headlines about a coming pick-up in Covid-19 data begin to circulate ahead cold and flu season.
The company offers 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. Most importantly for this analysis, it is also a key player in Covid-19 testing.
Laboratory Corp. of America Holdings (NYSE:LH) is trading this morning immediately after announcing a statement: Labcorp continues to make progress executing our strategy and capitalizing on the power of our diagnostic and drug development businesses. We are successfully accelerating growth across our platform, while playing a critical role in the fight against COVID-19 and helping our clients develop next-generation solutions for other key therapeutic areas such as oncology, liver and kidney disease, Alzheimer’s and autoimmune disorders.
While we continue to see strong momentum across our operations, the Labcorp Board of Directors and management team believe that our value is not being appropriately reflected in the Company’s current stock price. Therefore, the Board of Directors is undertaking a review of the Company’s structure and capital allocation strategy to ensure we are best positioned to unlock shareholder value while we continue to support patients and customers around the world.
Even with that news, the action hasn’t really heated up in the stock, with shares moving net sideways over the past week.
Laboratory Corp. of America Holdings (NYSE:LH) managed to rope in revenues totaling $4.5B in overall sales during the company’s most recently reported quarterly financial data — a figure that represents a rate of top line growth of 52%, 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 ($1.3B against $3.1B, respectively).
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