Friday’s decision by the Government to scrap PCR testing for fully vaccinated outbound travellers to low-risk countries on Day 2 & 8 – MAY impact performance at rapidly expanding, healthcare services firm SourceBio International Plc.
However to me, regardless of any changes to future FY21-22 guidance, there are equally a number of positives to draw from today’s news.
Firstly the company continues to knock the ball out the park in terms of Q3 PCR testing volumes - which so far have been more than triple H1’s daily average.
Next, there is a good chance that some of the potentially affected revenues will be offset by the introduction of 2 new lateral flow tests with partners Excalibur Healthcare & Everything Generic.
Meanwhile England's new international travel rules should encourage more people to holiday abroad (re weekend bookings for Autumn half term breaks up 200%+ YoY) - which could also lift throughout of its existing "Fit to Fly" outbound diagnostics.
More importantly though, I suspect #SBI’s other core activities – genomic sequencing, lab services, diagnostic screening (eg cancer) & sample storage – are all probably experiencing rising demand (at various degrees). As the NHS urgently tries to reduce the nation’s chronic 5.5m patient backlog (& climbing), after receiving a further £5.4bn of extra funding.
Consequently regardless of today’s mini selloff, I still believe the stock is significantly undervalued, & will be updating my valuation once the H1 numbers are released on Tuesday 28th September.