What happened
Monday was a very good day for stocks in general, but it was a standout day for healthcare diagnostics specialist Cue Health (NASDAQ: HLTH). In retrospect, the stock's nearly 22% leap wasn't surprising, as the current state of the world plays perfectly to the company's strength.
So what
On its website, Cue Health isn't shy to point out that it's the maker of the first molecular diagnostic test for COVID-19 approved by the U.S. Food and Drug Administration (FDA). So as far as coronavirus testing goes, the company was a first mover, with a product that is relatively better established than others. Cue Health's COVID diagnostic test is also a product that can be administered at home with no training.
Image source: Getty Images.
The appeal of such a test is clear and obvious in an environment when cases are growing precipitously due to the omicron variant. Although early research suggests that the variant isn't as lethal as its predecessors, it's still very much a threat -- particularly to the immuno-compromised and other vulnerable populations.
The latest variants are, understandably, significantly boosting the healthcare company's fundamentals. On the solid foundation of its COVID testing product, the company's total revenue grew by a robust 63% quarter-over-quarter in Q3. On a year-over-year basis, product revenue expanded more than one hundred-fold.
Now what
Demand for Cue Health's COVID test should only rise in the coming weeks. This will be aided by additional regulatory approvals, such as the one granted on Dec. 1 by Singapore's Health Sciences Authority.
Corporate interest will also probably increase; last week, the company announced it was partnering with Air Canada to give American passengers access to the Cue Health test in order to satisfy coronavirus screening requirements for visiting that country.
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Eric Volkman 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.
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