The Food and Drug Administration approved the emergency use of Quidel Corporations (NASDAQ:QDEL) rapid antigen testing for use across the country. In recent weeks, antigen testing for COVID-19 has sparked speculation amongst investors – being marked as one of the biggest opportunities in our current market. This year alone has seen Quidel stock reach all time highs, more than doubling it’s value this time last year. The approval also comes off the back of Gilead being conditionally approved by the FDA for their treatment Remdesivir. The critical timeframe for Bio-techs to make their mark on COVID-19 is closing. Quidel’s rapid testing may give Governments the confidence to re-open the economy, a crucial step in igniting a market recovery.
However, this company is not off the ropes just yet. With this FDA approval, the agency mentioned that “Antigen tests are very specific for the virus, but are not as sensitive as molecular PCR tests,”. This means that the tests itself is more likely to give readings of false negatives – shaking the confidence in Governments hesitant to rely on such a test.
What is Quidel’s reputation in the industry?
Reputation is everything in the pharmaceutical game. Since its inception in 1979, Quidel has created a name for itself in the diagnostic healthcare space. Quidel is a global diagnostic healthcare manufacturer. QDEL focuses on lateral flow (detecting diseases in liquids), Direct Fluorescent Antibodies (uses antibodies to detect antigens), and micro-titer production. Quidel also devotes its attention to developing Sofia (testing) kits. QDEL’s decision to develop testing kits is scoring them unprecedented investor and media attraction.
On top of the robust pipeline, is Quidel’s 40 plus years of R&D in Germany and the States. QDEL’s research reinforces their undivided commitment to making the world a healthier place.
Overall, QDEL’s continuous developments to technology and impressive pipeline over the past 40 years has made Quidel the market leader it is today.
Is Quidel worth the investment?
Before I start, I am obliged to remind our viewers that this is not advice, only general commentary from my extensive research in this area.
Something important to remember is that Qiduel is currently trading at the highest price it has ever been since IPO in 1981. The Bio-tech has since then built an empire with $6.66 billion in market cap and a 5 Y Beta of 1.06. Like we say with every Bio-tech chasing the COVID-19 goldmine, only a hand full will succeed. Therefore, the risk in putting your money towards companies like these holds significant risk of its own. From researching the trends in these particular stocks, the bio-techs that have a deep history in success and have remained dynamic in their research – have always held their value after speculators flee.
In the case of Qiduel, we are looking at a strong bio-tech however it comes down to their current value. Is $158 too high? In reality the company has gained significant stock growth over the past few months as speculators flocked to get a good price. The stock itself may not yield enough growth to make the investment worthwhile considering the unknown risk factors.
The information above should not be taken as financial advice. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you.
Written by Patrick McLoughlin, and Tyger Fitzpatrick, Senior Manager of YIG, and Founder.