Shares of Abbott Laboratories (ABT -1.09%) rose 16.7% in April, according to data provided by S&P Global Market Intelligence, as the company launched a third coronavirus test and announced work on a fourth.
The company launched its first two coronavirus tests in late March and followed up with another test last month. The first two are molecular coronavirus detection tests, with one being the world's fastest. This portable test can be used in point-of-care situations and produces positive results in as little as five minutes and negative results in 13 minutes. The latest test is an antibody blood test that determines if a person has been previously infected with COVID-19, the illness caused by the coronavirus.
Abbott said during its latest earnings call that it now is working on a lateral flow serology test that would make mass testing across the entire population possible.
As COVID-19 cases top 3.4 million worldwide, testing is greatly needed. Local and national governments have struggled to obtain tests, as well as determine a way to test everyone. The development of a lateral flow serology test, a simple method that is easy to roll out on a large scale, may be a solution to the problem.
Abbott's launch of the COVID-19 tests was too recent to contribute to first-quarter earnings, but the company said in its earnings call that these tests will be more significant in the next report.
Abbott saw a decline in some diagnostic tests in the first quarter as nonessential procedures were postponed due to the coronavirus outbreak. As a result, revenue in core laboratory diagnostics fell 6.8%. Still, other tests compensated, and total diagnostics revenue only slipped 0.8%. Investors will be watching the next earnings report to see how the coronavirus tests are contributing to diagnostics revenue.
The focus also will be on the development of the lateral flow serology test as screening of the general population represents a big opportunity. CEO Robert B. Ford didn't offer an exact development time frame for this test, but in the earnings call, he said, "We're almost there."
And finally, investors should look to see if Abbott can meet shipping goals for its tests. Abbott said that for the latest version (the antibody blood test), it aims to ship 20 million per month in the U.S. as of June.