What happened
The world is facing yet another threat from the coronavirus, as the fast-spreading omicron variant continues to gain traction. So it makes sense that companies with effective COVID-19 diagnostics solutions are attracting plenty of investor interest these days. Case in point: Quidel (QDEL), which as of mid-afternoon Friday was up by over 21% week to date.
So what
Although early indications are that omicron causes a less severe form of COVID, its rapid transmission alone is cause for great concern. As much of the world is locked in the grip of winter and thus frequently stuck inside with other people, omicron has an ideal environment in which to do its work.
Image source: Getty Images.
As a result, cases and fatalities are currently rising at precipitous rates. According to The New York Times' coronavirus tracker, the former has risen by 31% over the past 14 days, while the latter has climbed up by 23%.
This plays to the strength of Quidel in the coronavirus testing segment, as top-down testing and vaccination mandates either remain in force or are introduced by entities that hadn't previously required them. Also, the level of personal fear is rising along with those escalating numbers. As a result, many people not covered by mandates are willingly submitting to COVID tests.
Now what
COVID testing is the motor driving Quidel's success just now. In the healthcare company's third-quarter, which occurred amid the spread of the delta variant, such diagnostics comprised nearly 80% of revenue (which, incidentally, rose by 7% year over year in total).
As long as the coronavirus -- whichever variant happens to be raging at the moment -- is on a rampage, the company should continue to do well.
