Lab share prices suggest Covid testing is here to stay
Covid testing is here to stay, at least for the foreseeable future. This is the clear message from the stockmarket, as the infographic below, which was presented at HBI 2021 by Hedley Goldberg, managing director at Rothschild & Co, illustrates.
Click here to see the HBI Intelligence country lab reports and here to see the largest players in this sector by revenue.
Click top right to expand this infographic
Goldberg told HBI 2021 it is interesting to see how market thinking has evolved: “When you got to March/April of this year, the market started discounting Covid 100%. So I think Synlab, which had an IPO in April, probably picked just about the worst time because the market was saying ‘everyone is getting vaccinated, this is basically over, there will be some tail revenues for maybe a few months but testing has gone’.
“I think as you got through the year, and you can see this in the share price of these companies, and bear in mind this is as vaccines ramped up in most western countries, the market thought ‘this is going to be with us for a long time’. I would say if you look through the earnings statements of the analyst reports of some of these companies, they are predicting at the low end 20% probably at the top end probably 35% of historic volumes in Covid going forward for the medium term, i.e. we are into a cycle now where there are going to be new variants, the efficacy of the vaccines is going to deteriorate over time, there are going to be spikes – and therefore testing is going to be very much part of the system for some time.”
HBI 2021 ticket holders / HBI Connect members can click here to see the full presentation and all slides. All sessions at HBI 2021 were recorded and these and previous recordings are available on demand.
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