Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of Quidel , a developer and manufacturer of diagnostic testing solutions for infectious diseases, gastrointestinal diseases, and women's health, advanced as much as 12% after the company announced after the bell yesterday that it had received FDA clearance for its AmpliVue Group B Strep Assay.
So what: According to Quidel's press release, the AmpliVue Group B Strep Assay will allow doctors and technicians in a hospital or laboratory setting to rapidly detect Group B streptococcus, or GBS, in antepartum women. The Centers for Disease Control and Prevention recommends a GBS test between weeks 35 and 37 of a pregnancy. The federal public health agency also estimates that 10%-30% of pregnant women carry GBS, according to Quidel's press release,
Now what: With Quidel's rapid test immediately available for marketing, the upside reaction in shares seems fitting. Admittedly, Quidel isn't a particularly cheap stock here at 75 times next year's earnings, but the ease of use of its rapid molecular diagnostic tests and its growing portfolio of products is impressive. On the flip side, the Obamacare health insurance overhaul clouds the spending picture for numerous health providers over the near term and draws into question Medicare reimbursement rates in the future. So optimists may want to temper their expectations a bit in 2014.
Here's one stock with few tempered expectations in 2014
There's a huge difference between a good stock, and a stock that can make you rich. The Motley Fool's chief investment officer has selected his No. 1 stock for 2014, and it's one of those stocks that could make you rich. You can find out which stock it is in the special free report: "The Motley Fool's Top Stock for 2014." Just click here to access the report and find out the name of this under-the-radar company.
The article Why Quidel Shares Jumped originally appeared on Fool.com.
Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.