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If Moderna’s Coronavirus Vaccine Fails, These 3 Stocks Could Take Off

Last Updated September 23, 2020 1:57 PM
Mark Emem
Last Updated September 23, 2020 1:57 PM
  • There’s a strong possibility that the long-awaited coronavirus vaccine could take longer to develop.
  • In the absence of a vaccine, testing will be vital to containing the pandemic without harming economies any further.
  • At-home COVID-19 test kits are already available.

News of a promising coronavirus vaccine being developed by Moderna (NASDAQ: MRNA) injected optimism into global equity markets. But that optimism may have been premature, according to some medical practitioners.

Vaccine experts are urging caution because the information provided by Moderna is not enough  to draw wide-ranging conclusions. Additionally, Moderna simply issued a “press release” without actually publishing the results of the clinical trial.

Moderna’s coronavirus data leave a lot of questions unanswered. | Source: Twitter 

While there are dozens of companies and organizations working on a coronavirus vaccine, experts have cautioned that success is not guaranteed.

Will Covid-19 experience the same vaccine failures as SARS-COV-1?

A SARS-COV-1 coronavirus vaccine remains undeveloped nearly two decades after it appeared.

Funding woes impact vaccine research. | Source: Twitter 

And studies show that the Food and Drug Administration only approves 10% of vaccines  that enter clinical trials.

Testing will, therefore, be vital to ensuring that life goes on as close to normal as possible, in the absence of a COVID-19 vaccine. Companies that provide coronavirus diagnostic testing kits could be the big winners if a vaccine fails or is late to the market:

Abbott Laboratories – over a million COVID-19 tests so far

Medical-device maker Abbott Laboratories (NYSE: ABT) has been at the forefront of developing COVID-19 testing kits.

Among the medical device maker’s achievements is a universal coronavirus test that can be completed in at least five minutes .

As of May 11, Abbott shipped 1.7 million COVID-19 tests to U.S. customers  and many more across the globe.

Abbott Laboratories had also shipped 7.2 million antibody tests as of May 11.

The current manufacturing capacity is 1.5 million tests per month. Abbott plans to increase that to 2 million by June.

Among the 21 analysts covering the firm, 14 have rated Abbott a ‘Buy.’ 

Abbott Laboratories
Analysts have rated Abbott favorably. | Source: WSJ 

With the average price target being $101.5, there is an upside potential of 15%.

No nasal swab, just a finger prick with Chembio Diagnostics’ test

The Food and Drug Administration approved Chembio’s 15-minute finger-prick coronavirus test  over a month ago.

The Medford, New York-based diagnostic firm has repurposed its HIV-testing production capacity to manufacture coronavirus test kits.

The analysts’ consensus rating for Chembio Diagnostics  (NASDAQ: CEMI) is a ‘Buy.’

Chembio Diagnostics
CEMI could surge triple digits from the current price, according to Wall Street. | Source: WSJ 

The stock could jump 130% from the current levels, according to analysts.

You can now buy a Quest Diagnostics COVID-19 test kit online

Quest Diagnostics (NYSE: DGX) introduced its COVID-19 test in early March.

At the peak of the pandemic, Quest Diagnostics’ lab services accounted for close to 50% of all coronavirus testing in the U.S. 

And late last month, Quest launched direct-to-consumer COVID-19 tests. This allows individuals to order a test online without having to visit a doctor . The test costs $119.

COVID-19 tests can now be purchased online. | Source: Twitter 

The consensus rating is ‘Overweight.’

Quest Diagnostics
Wall Street has issued a consensus rating of ‘Overweight’ on DGX. | Source: WSJ 

Quest Diagnostics is underpriced by about 30%  relative to the highest stock price target issued on the stock.

Disclaimer: This article represents the author’s opinion and should not be considered investment advice from CCN.com. The author holds no investment position in the aforementioned securities.