Coronavirus Test Makers Outperform After Analysts Tout Developments

(Bloomberg) --

A handful of healthcare companies that are developing or selling tests to diagnose the coronavirus traded higher on Thursday after Cowen analysts highlighted the rise in the number of tests being conducted in the U.S.

Hologic Inc. and Laboratory Corp of America Holdings were the top performers in the S&P 500 Health Care Index in early trading, as Cowen analysts led by Doug Schenkel said the ramping number of coronavirus tests was “encouraging and consistent with our expectation that testing capacity could expand significantly” to about 500,000 per day by the end of May.

Comments from President Donald Trump on Wednesday evening surrounding both flu and Covid-19 infections offered a positive for companies that make tests for both diseases, Schenkel wrote. “The frequent mention of the need to be prepared to rapidly delineate between flu, Covid-19, and other infections” is a clear strength for multiplex tests offered by GenMark Diagnostics Inc., QIAGEN NV and others.

That need also provides a benefit for higher-volume single marker test providers such as Thermo Fisher Scientific Inc., Danaher Corp. and Hologic, among others, the note continued.

Hologic rose as much as 8.1% in Thursday’s session, to touch the highest level in almost seven weeks. LabCorp. extended a three-day winning streak to the highest since March 11. Small-cap GenMark, which has more than doubled this year, rose as much as 18% to the highest level since Aug. 2017.

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