The crisis triggered by the coronavirus pandemic has been taking its toll on the global economy. While most sectors were hit hard by the economic turmoil, the MedTech sector was resilient enough to rebound from the chaos quite swiftly.
The sector started showing signs of recovery from the second half of 2020, courtesy of a number of positive developments. These are regulatory clearances, a number of COVID-19 diagnostic test launches and the rapid consumer adoption of digital healthcare options plus critical care products and services.
Below we discuss three MedTech trends, which showed a steady momentum through the pandemic year and are likely to sustain even after the economic mayhem draws to a close.
With the onset of the pandemic and the recent emergence of the new coronavirus strains that are claimed to be 56% more contagious, demand for testing witnesses a sharp surge, posing a challenge to the United States in terms of test kit restocking. Little wonder that during this time, the diagnostic testing space is receiving a major boost with newer and more improved tests being developed on a daily basis by several leading MedTech players.
In fact, the Centers for Disease Control and Prevention’s (CDC) recent announcement of The Department of Health and Human Services’ (HHS) above $22-billion offering to fund the nation’s COVID-response plans bears a strong indication that this industry niche still has more room for improvement.
Among the major diagnostic testing stocks that have so far took giant strides in terms of COVID-19 testing and are therefore on investors’ radar,
Hologic’s ( HOLX Quick Quote HOLX - Free Report) name comes first. In October 2020, HHS and the Department of and Defense (DOD) inked a $119-million deal with the company to ramp up additional domestic production for increasing the diagnostic testing capacity to detect SARS-CoV-2. The contract will allow this currently Zacks Rank #1 (Strong Buy) stock to expand the production scale for COVID-19 tests at certain suppliers’ facilities to about 13 million tests per month by January 2022. You can see the complete list of today’s Zacks #1 Rank stocks here.
Over the past year, the stock has gained 40.2% compared with the
industry’s rally of 22.1%
Another stock in this space is
PerkinElmer, Inc. ( PKI Quick Quote PKI - Free Report) . The company’s newly-unveiled Coronavirus Nucleic Acid Detection Kit is a real-time RT-PCR test that has the lowest Limit of Detection (LoD) among the authorized COVID-19 molecular diagnostic tests being reported so far. This speciality makes it the most sensitive assay, which can now test both symptomatic and asymptomatic individuals.
In December 2020, PerkinElmer introduced the CE mark EURORealTime SARS-CoV-2/Influenza A/B for direct detection of SARS-CoV-2, influenza virus type A and type B. In the same month, PerkinElmer rolled out the CE marked SARS-CoV-2 Antigen ELISA for specific determination of the SARS-CoV-2 protein.
Over the past year, this currently Zacks Rank #2 (Buy) company’s shares have soared 47.6% compared with the
industry’s rally of 28%. Remote Patient Monitoring
In the wake of the pandemic, remote patient monitoring tools saw a steady spike in demand on higher consumer adoption of digital healthcare options. It is a form of AI-powered technology, which can be utilized to assimilate patient data outside the traditional healthcare settings as well as monitor the patient health status cautiously. This was necessitated by the urgency to curtail the need for clinic and hospital visits, thereby minimizing the exposure to the deadly virus.
Per a Markets and Markets report, the global remote patient monitoring market is projected to reach $117.1 billion by 2025 from $23.2 billion in 2020, seeing a CAGR of 38.2% between 2020 and 2025.
Here we ask investors to keep a close eye on
Allscripts Healthcare Solutions, Inc. ( MDRX Quick Quote MDRX - Free Report) . In mid 2020, the company’s business unit Veradigm reached an agreement with Surescripts to enhance its Veradigm AccelRx specialty medication fulfillment solution with Surescripts Specialty Patient Enrollment.
Previously, management had announced that the company’s clients across the nation signed up to rapidly facilitate telehealth visit capabilities to their patients. Notably, the company provides simplified telehealth implementation to health systems through its electronic health record (EHR)-agnostic patient engagement platform known as FollowMyHealth.
Over the past year, this presently Zacks Rank #3 (Hold) company’s shares have surged 78.4% compared with its
industry’s rally of 28.6%
Through 2020, within Home Health, admission volumes improved significantly. The stocks saw signs of progress in episodic market activities. Although the impact of COVID-19 ultimately led to increased lupus and lost building periods in home health population, the market watchers are confident of a strong setting/ perfect platform for solid growth in 2021.
Apart from COVID-19-led upsides, we note that this niche industry holds enormous long-term prospects.
Per a GrandView Research report, the global home healthcare market size was worth $281.8 billion in 2019 and is projected to witness a CAGR of 7.9% from 2020 to 2027. Advancement of this market is being fuelled by the ballooning geriatric population around the world and the rising patient preference for value-based healthcare. As the aging population has an inherent tendency to opt for more patient-centric, personalized healthcare services, the home health care market experienced speedy growth of late. Amedisys, Inc. ( AMED Quick Quote AMED - Free Report) , a major home health player, saw 5% total admission growth and 6% total volume growth within its home health segment in the last reported quarter. This indicated a bold and fast business recovery from the initial impact of COVID-19.
Over the past year, this currently Zacks Rank #3 stock has jumped 65.2% compared with
industry’s rally of 13.3%
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