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3 Diagnostics Stocks in Focus Amid the Omicron Outbreak
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With the new COVID-19 variant, Omicron, on the horizon, demand for molecular testing, regarded as the gold standard for diag¬nosing infectious diseases, has again exploded. The returned focus on diagnostics comes when investor focus is seemingly shifting to pharma and healthcare as the market reacts to the emergence of Omicron.
Going by a Forbes article of Dec 21, 2021, diagnostics testing stocks rose 24% in 2021. The recent surge in new cases, mostly driven by the highly contagious variant, firmly authenticates that COVID-19 testing demand will stay in the near to medium term, as the pandemic proves challenging to contain given the diminishing immunity provided by vaccines and the constant mutation of the virus. Considering this, diagnostic testing will remain key to containing the spread of COVID-19 and keeping the broader economy open.
Here are the three companies Thermo Fisher Scientific Inc. (TMO - Free Report) , QIAGEN N.V. (QGEN - Free Report) and Quidel Corporation (QDEL - Free Report) that are expected to gain enormously from the rise in testing demand with the outbreak of the new variant.
Recent Surge in Cases
According to U.S. Centers for Disease Control and Prevention, the seven-day-average number of daily hospitalizations for children between Dec 21 and Dec 27 is up more than 58% in the United States. Omicron cases are expected to spread faster across the United States with the reopening of schools.
Increase in Testing Demand
As Omicron spooks markets, diagnostic companies are striving to determine whether the latest mutations will hinder the performance of their screening tests. Many diagnostics companies have stated that their PCR tests in the market for COVID-19 are not affected by the new strain.
Per a Reuters report, President Joe Biden inked a $137-million contract to boost the production capacity of a highly constrained component of rapid coronavirus tests. Earlier this month, the President announced a COVID-19 response plan that includes a major effort to increase at-home rapid testing. This plan includes opening new federal testing sites to increase capacity and distributing 500 million at-home, rapid tests to Americans.
With demand for testing increasing, Quest Diagnostics (DGX - Free Report) recently reported the majority of COVID-19 molecular diagnostic test results in a day. The company has performed and reported nearly 64.7 million COVID-19 molecular diagnostic and serology tests since 2020. Furthermore, Quest Diagnostics confirmed that its COVID-19 molecular (PCR/NAAT) and antigen testing services will detect infection with SARS-CoV-2, including the Omicron variant.
Stocks in Focus
Going by the aforementioned discussion, diagnostics companies are expected to witness a sharp rise in testing demand over the coming months. Investors can choose to bet on the following stocks that have shown tremendous promise amid the pandemic and challenging market conditions. These stocks also possess considerable growth potential.
Thermo Fisher is committed to supporting the world's pandemic response by monitoring new SARS-CoV-2 variants and developing innovative, adaptive and resilient testing solutions. The company recently confirmed that its polymerase chain reaction (PCR) TaqPath COVID-19 Combo Kit and TaqPath COVID-19 CE-IVD RT-PCR Kit, which test the presence of SARS-CoV-2, are not impacted by Omicron, enabling accurate test results. In addition to the original TaqPath COVID-19 tests, Thermo Fisher has developed the TaqPath COVID-19 2.0 tests with an advanced assay design to compensate for emerging mutations. In December 2021, the company launched a significant expansion of the K-12 ReadyCheckGo COVID-19 testing solution in Texas. The program, formed in agreement with the Texas Department of State Health Services (DSHS), is now available to all school districts in the state.
Image Source: Zacks Investment Research
Thermo Fisher currently carries a Zacks Rank #2 (Buy). Over the past six months, TMO has gained 30% compared with the industry’s 8.1% rise.
QIAGEN recently confirmed that its polymerase chain reaction (PCR) tests remain accurate and effective in detecting SARS-CoV-2 infections in light of the emergence of a new variant. The company noted that its QIAcuity digital PCR solution and QIAprep& Viral RNA kit are reliable for detecting the Omicron variant. In December 2021, QIAGEN announced the receipt of CE marking of its QuantiFERON SARS-CoV-2 assay that measures T-cell responses to SARS-CoV-2 and aids in assessing immunity in individuals who have received COVID-19 vaccination.
Image Source: Zacks Investment Research
QIAGEN currently carries a Zacks Rank #3 (Hold). Over the past six months, QGEN has gained 12.2% versus the industry’s 18.5% fall.
Quidel -- a provider of rapid diagnostic testing solutions, cellular-based virology assays and molecular diagnostic systems confirm that its antigen tests continue to detect COVID-19 variants such as Omicron. The company noted that its QuickVue At-Home OTC COVID-19 Test and Sofia SARS Antigen FIA detect the SARS-CoV-2 Omicron variant. Further, in December 2021, Quidel and Ortho Clinical Diagnostics entered into a definitive agreement under which Quidel will acquire Ortho, one of the world’s largest in-vitro diagnostics companies. The acquisition will provide Quidel with an expansive point-of-care diagnostics portfolio with access to Ortho’s broad global reach across 130-plus countries, accelerating growth for Quidel’s existing product portfolio and providing exposure to new, emerging markets.
Image: Bigstock
3 Diagnostics Stocks in Focus Amid the Omicron Outbreak
With the new COVID-19 variant, Omicron, on the horizon, demand for molecular testing, regarded as the gold standard for diag¬nosing infectious diseases, has again exploded. The returned focus on diagnostics comes when investor focus is seemingly shifting to pharma and healthcare as the market reacts to the emergence of Omicron.
Going by a Forbes article of Dec 21, 2021, diagnostics testing stocks rose 24% in 2021. The recent surge in new cases, mostly driven by the highly contagious variant, firmly authenticates that COVID-19 testing demand will stay in the near to medium term, as the pandemic proves challenging to contain given the diminishing immunity provided by vaccines and the constant mutation of the virus. Considering this, diagnostic testing will remain key to containing the spread of COVID-19 and keeping the broader economy open.
Here are the three companies Thermo Fisher Scientific Inc. (TMO - Free Report) , QIAGEN N.V. (QGEN - Free Report) and Quidel Corporation (QDEL - Free Report) that are expected to gain enormously from the rise in testing demand with the outbreak of the new variant.
Recent Surge in Cases
According to U.S. Centers for Disease Control and Prevention, the seven-day-average number of daily hospitalizations for children between Dec 21 and Dec 27 is up more than 58% in the United States. Omicron cases are expected to spread faster across the United States with the reopening of schools.
Increase in Testing Demand
As Omicron spooks markets, diagnostic companies are striving to determine whether the latest mutations will hinder the performance of their screening tests. Many diagnostics companies have stated that their PCR tests in the market for COVID-19 are not affected by the new strain.
Per a Reuters report, President Joe Biden inked a $137-million contract to boost the production capacity of a highly constrained component of rapid coronavirus tests. Earlier this month, the President announced a COVID-19 response plan that includes a major effort to increase at-home rapid testing. This plan includes opening new federal testing sites to increase capacity and distributing 500 million at-home, rapid tests to Americans.
With demand for testing increasing, Quest Diagnostics (DGX - Free Report) recently reported the majority of COVID-19 molecular diagnostic test results in a day. The company has performed and reported nearly 64.7 million COVID-19 molecular diagnostic and serology tests since 2020. Furthermore, Quest Diagnostics confirmed that its COVID-19 molecular (PCR/NAAT) and antigen testing services will detect infection with SARS-CoV-2, including the Omicron variant.
Stocks in Focus
Going by the aforementioned discussion, diagnostics companies are expected to witness a sharp rise in testing demand over the coming months. Investors can choose to bet on the following stocks that have shown tremendous promise amid the pandemic and challenging market conditions. These stocks also possess considerable growth potential.
Thermo Fisher is committed to supporting the world's pandemic response by monitoring new SARS-CoV-2 variants and developing innovative, adaptive and resilient testing solutions. The company recently confirmed that its polymerase chain reaction (PCR) TaqPath COVID-19 Combo Kit and TaqPath COVID-19 CE-IVD RT-PCR Kit, which test the presence of SARS-CoV-2, are not impacted by Omicron, enabling accurate test results. In addition to the original TaqPath COVID-19 tests, Thermo Fisher has developed the TaqPath COVID-19 2.0 tests with an advanced assay design to compensate for emerging mutations. In December 2021, the company launched a significant expansion of the K-12 ReadyCheckGo COVID-19 testing solution in Texas. The program, formed in agreement with the Texas Department of State Health Services (DSHS), is now available to all school districts in the state.
Thermo Fisher currently carries a Zacks Rank #2 (Buy). Over the past six months, TMO has gained 30% compared with the industry’s 8.1% rise.
QIAGEN recently confirmed that its polymerase chain reaction (PCR) tests remain accurate and effective in detecting SARS-CoV-2 infections in light of the emergence of a new variant. The company noted that its QIAcuity digital PCR solution and QIAprep& Viral RNA kit are reliable for detecting the Omicron variant. In December 2021, QIAGEN announced the receipt of CE marking of its QuantiFERON SARS-CoV-2 assay that measures T-cell responses to SARS-CoV-2 and aids in assessing immunity in individuals who have received COVID-19 vaccination.
QIAGEN currently carries a Zacks Rank #3 (Hold). Over the past six months, QGEN has gained 12.2% versus the industry’s 18.5% fall.
Quidel -- a provider of rapid diagnostic testing solutions, cellular-based virology assays and molecular diagnostic systems confirm that its antigen tests continue to detect COVID-19 variants such as Omicron. The company noted that its QuickVue At-Home OTC COVID-19 Test and Sofia SARS Antigen FIA detect the SARS-CoV-2 Omicron variant. Further, in December 2021, Quidel and Ortho Clinical Diagnostics entered into a definitive agreement under which Quidel will acquire Ortho, one of the world’s largest in-vitro diagnostics companies. The acquisition will provide Quidel with an expansive point-of-care diagnostics portfolio with access to Ortho’s broad global reach across 130-plus countries, accelerating growth for Quidel’s existing product portfolio and providing exposure to new, emerging markets.
Quidel currently carries a Zacks Rank #1 (Strong Buy). Over the past six months, QDEL has gained 7.7% versus the industry’s 7.4% fall. You can see the complete list of today’s Zacks #1 Rank stocks here.