Here’s why Invitee shares jumped as much as 13.2% today
Shares of a genetic testing company Guests (NYSE: NVTA) rose more than 13% today in an upbeat day for the stock market. the S&P500 rose more than 1.5% as investors cheered plans by some countries and US states to soon begin reopening parts of their economies.
While the vast economic damage caused by the coronavirus pandemic could take quarters or years to repair, the genetic testing industry could experience a faster recovery. Indeed, strict stay-at-home orders have a negative impact on the number of genetic tests and diagnostics ordered by doctors. But if restrictions are eased in the coming weeks or months, doctors should be able to resume certain types of essential services, such as hereditary tests for pregnant women or oncology tests for cancer patients.
At 3:15 p.m. EDT, the growth stock had settled at an 8.4% gain.
Invitae has not commented publicly on the impact of the coronavirus pandemic on operations, but investors can likely expect at least a near-term downside. Peer NeoGenomics reported a 20% decline in testing volumes in the last two weeks of March and early April, compared to the year-ago period.
Invitae is expected to report its first quarter 2020 results and update its outlook on May 5. A temporary slowdown in growth might not matter much in the long run, but a grow-at-all-costs business model doesn’t leave the company well. positioned to endure a prolonged economic rut. Investors will have to wait for more details before lazily assuming the company will be spared.
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