NEW YORK CITY, March 10, 2020 (GLOBE NEWSWIRE) -- H.C. Wainwright analyst Yi Chen released additional coverage on Co-Diagnostics (NASDAQ:CODX), a Utah-based molecular diagnostics company, raising the firm’s price target to $20 and keeping a Buy rating on the shares. Co-Diagnostics was the first U.S. company to receive CE Marking designation for a COVID-19 test, Chen tells investors in a research note. The analyst believes a recent FDA policy change to help expedite the availability of COVID-19 coronavirus diagnostics could be a significant boost to the company's potential sales of its COVID-19 test domestically.
Co-Diagnostics is now shipping its proprietary COVID-19 test to countries across four continents, including America, Europe, Asia and Australia, said the analysts, adding “the domestic and international demand for COVID-19 tests has been surging in the past weeks.”
The company has been seeing an increase in product shipments of its Logix Smart COVID-19 screening test following the US Food and Drug Administration’s decision late last month to allow labs that meet a set of standards known as the Clinical Laboratory Improvement Amendments (CLIA) to use coronavirus detection tests that have been validated by the laboratories, even before the FDA has completed the review of the labs’ Emergency Use Authorization (EUA) submission.
Previously, labs seeking to use coronavirus tests had to wait for specific clearance from the FDA.
This recent activity coincides with the company completing a registered direct offering of 470K shares at $9 per share for gross proceeds of $4.2M, which leads the analyst to estimate that the company’s pro forma cash position post offering could approximate $24M, which should fund operations for the next three years.
According to the Wainwright analyst:
“In view of the continuing—and rapidly accelerating—COVID-19 infection spread worldwide and initialization of shipments to U.S. labs, we have increased the enterprise value-to-sales (EV/Sales) multiple to 12x from 10x and projected 2020 total sales to $1.66 from $0.40 per share, which leads to a value of $20 per share. Therefore, we reiterate our Buy rating while raising the 12-month target to $20 from $4 per share.”
The full research report can be accessed here.
Disclosure: Co-Diagnostics Inc is a client of BDA International.
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