Please ensure Javascript is enabled for purposes of website accessibility

Why Co-Diagnostics Stock Is Absolutely on Fire Today

By George Budwell - Updated Feb 27, 2020 at 9:36AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Shares of the medical diagnostics company keep churning higher.

What happened

Shares of the medical diagnositics company Co-Diagnostics (CODX -30.65%) gained another 152% in pre-market trading Thursday. The company's shares have now risen by a jaw-dropping 1,240% since the start of the year.

What's driving this sustained breakout in the company's stock? On Feb. 24, Co-Diagnostics announced that it had received regulatory clearance for its Logix Smart Coronavirus COVID-19 test. As a result, this first-of-its-kind diagnostic will reportedly become immediately available for export from the United States as a CE-marked in-vitro diagnostic. In plain terms, this newly approved test can be used for a rapid diagnosis of patients suspected of having the SARS-CoV-2 (COVID-19) virus in countries that accept CE marking (meaning it meets Europe's standards) as a valid regulatory approval. 

A young man wearing shades throwing U.S. currency into the air.

Image source: Getty Images.

So what

Diagnosing the COVID-19 illness has proved to be a tough nut to crack for a variety of reasons. So there is a well-defined medical need for an easy-to-use molecular diagnostic. Co-Diagnostics hopes that the Logix Smart Coronavirus COVID-19 test can fill in this gap. If so, this product could turn out to be a huge boon for the company from a financial standpoint. There are already well over 80,000 documented cases of patients with COVID-19. What's more, several countries like Italy, Iran, and South Korea have experienced a notable spike in the number of cases in recent days. 

Now what

Co-Diagnostics' market cap still remains under $300 million, even after this latest jump. So while it's hard to estimate how big a commercial opportunity this test represents, it surely dwarfs the company's present market cap. Put bluntly, this small-cap biotech stock could have a lot more room to run, despite its already monstrous spike since the start of the year. 

George Budwell has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Co-Diagnostics, Inc. Stock Quote
Co-Diagnostics, Inc.
CODX
$4.48 (-30.65%) $-1.98

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
400%
 
S&P 500 Returns
128%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 08/13/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.