Opportunities to be Tapped in the Healthcare Sector Amid Coronavirus

Opportunities to be Tapped in the Healthcare Sector Amid Coronavirus

Coronavirus has inflicted its first massive hit on the Australian markets with the S&P/ASX 200 closing the day’s trade on 09 March 2020 at a staggering 7.91% decline. Amidst the growing concerns of the viral infection, companies engaged in the manufacturing of diagnostic devices as well as antimicrobial products have been favorably impacted by COVID-19 as the world battles to shield against it. 

A novel coronavirus is described as a new strain that has not been identified earlier in humans. A recent example of such a virus is 2019-nCoV which had not been detected in the past. The World Health Organization (WHO) has classified this outbreak as a public health emergency of global concern.

On Saturday (07 March 2020) it was noted that the total number of COVID-19 cases crossed the 100,000 mark, with at least 27,000 cases outside China. WHO had appealed to all the countries to step up attempts in slowing the spread of COVID-19.  

The economic trauma triggered by the COVID-19 epidemic continues to influence the share markets across the globe. When blue-chip stocks are feeling the effects of the COVID-19 epidemic, the impact on smaller companies could be shattering.

However, with the rapid spread of the virus around the globe, there was a sudden surge in demand for surgical masks and hand sanitizers as protective measures against the coronavirus. This unprecedented rise in demand for such products profited some of the small caps health sector companies in a commercial sense, amidst the crisis of coronavirus. These small-cap stocks are catching the investors eyes these days amid coronavirus outbreak.

To know more, Do read: Healthcare stocks reacting to Corona Fears

Let us zoom lens on some ASX listed health care sector companies that have performed well during coronavirus crisis and have turned out to be an excellent opportunity for investors- UCM, ZNO, GSS.

USCOM Limited (ASX:UCM), stock up by 3x in 6 months

Stock performance

On 09 March 2020, UCM stock settled the day’s trade at $0.280, going down by 21.127%. With a market capitalisation of approximately $53.13 million, the stock has nearly 149.66 million shares outstanding. The Company has generated an exceptional return of 208.70% in the last six months and 195.83% in the previous three months.

About the Company

Sydney-headquartered, ASX-listed, medical technology player Uscom Limited is involved in the development, designing and international marketing of non-invasive cardiovascular and pulmonary medical devices. The Company has mainly three sets of devices in the area of cardiovascular and pulmonary monitoring; the USCOM 1A, the Uscom SpiroSonic Suite and Uscom BP+.

Urgent demand for USCOM 1A in China due to COVID-19 Outbreak-

In February 2020, the Company revealed a material increase in USCOM 1A orders from China during the past five weeks, with a few devices being specially installed for the monitoring of hospital patients detected with 2019-nCoV (coronavirus).

  • Uscom is planning to rise manufacturing output by nearly 121% for the third quarter of the financial year 2020.
  • The USCOM 1A haemodynamic monitor is extensively used in China for optimisation of infections management in infants, children, pregnancy, adults, as well as the elderly.
  • Several units of USCOM 1A have been installed in hospitals in China, and some are currently under installation.
  • The situation in China and other countries is speedily evolving, and the Company will continue to notify investors with additional details and material developments as they become available.

Also read: Stocks Benefited from COVID-19 Outbreak

Zoono Group Limited (ASX:ZNO), stock up by ~29x in 6 months

Stock performance

On 09 March 2020, ZNO stock settled the day’s trade at $1.640, down by 15.464% from its previous close. The market capitalisation of the stock was around $316.83 million, with approximately 163.31 million shares outstanding.

ZNO stock generated an outstanding return of 2795.52% in the last six months and an encouraging return of 183.21% on a year to date basis. 

About the Company

New Zealand- headquartered biotech company Zoono Group Limited is mainly into the development and distribution of antimicrobial formulations that are suitable for disinfecting surface, skincare and mould remediation treatments.

The verified antimicrobials of ZNO comprise surface and hand sanitizers which have demonstrated inhibition of coronavirus; these products are based on distinctive antimicrobial molecule recognised as the ‘zoono molecule’.  This molecule binds to the surface and destroys pathogens like bacteria, viruses, algae, mould etc.

Encouraging results from Z-71 Microbe Shield of Zoono Against COVID-19

On 28 February 2020, the Company revealed a report on the laboratory-based experiments conducted against coronavirus. The findings from the study indicated that Z-71 Microbe Shield of ZNO was >99.99% effective against inactivating the virus.

Additionally, the Company is pleased with the outcomes, which further proves the capability of the technology by Zoono to be part of providing a solution for preventing the spread of the coronavirus.

Collaboration with Eagle Health for sale in China

On 20 February 2020, Zoono Group unveiled its partnership with Eagle Health Holdings Limited (ASX:EHH) for the distribution of Zoono and Eagle co-branded products and offline retail sales in China.  

Moreover, in an ASX announcement dated 28 February 2020, Zoono provided additional information related to the collaboration.

Interesting Read: Coronavirus Blackswan Turns 3 Healthcare Stocks to Multibaggers

Genetic Signatures Limited (ASX:GSS) stock up by ~6.5% in 6 months

Stock performance

On 09 March 2020, GSS stock settled the day’s trade at $0.970, down by 9.346% from its previous close. The market capitalisation of the stock was around $152.29 million, with approximately 142.32 million shares outstanding. GSS stock’s 52-weeks high and low price was recorded at $1.400 and $0.925, respectively.

GSS stock generated a positive return of 6.47% in the last six months and 4.39% in the previous three months.

About the Company

A health care sector ASX-listed player Genetic Signatures Limited mainly operates as a molecular diagnostic company. The Company has developed a broad range of products for the detection of infectious diseases. GSS is centred on the development as well as commercialisation of 3Base™ the proprietary platform technology of the company.

Coronavirus update

Genetic Signatures formerly revealed that the Company’s EasyScreenTM Respiratory Pathogen targets comprise an assay for all known coronaviruses, including the novel strain (known as SARS-CoV-2) that originated from China.

SARS-CoV-2 can be detected with no changes to the existing assay of Genetic Signatures’ due to the distinctive capabilities of its 3baseTM technology.

The Company has fast-tracked a validation program, collaborating with local as well as international organisations, for obtaining the information required for international regulatory approvals as rapidly as possible. This presents a significant opportunity for the Company as laboratories and governments all over the world consider for trustworthy detection solution.

Financial Information

  • Total revenues from ordinary activities recorded at nearly $3,704 up by 7%, as compared to the previous corresponding period (pcp).
  • Revenue from sales was reported to be approximately $2,532, increased by 12% on pcp.
  • Cash balance of the Company as at 31 December 2019 was around $40,441,000.

Genetic Signatures witnessed robust progress on its commercialisation strategy in the first half of the financial year 2020.

Also read: How to Prepare for Coronavirus: Protective Measures and Myths 

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