Sonic Healthcare (ASX:SHL) share price struggles despite COVID passport positioning

The Sonic Healthcare share price tumbled from a record open this morning. Let’s take a closer look.
The post Sonic Healthcare (ASX:SHL) share price struggles despite COVID passport positioning appeared first on The Motley Fool Australia. –

The Sonic Healthcare Limited (ASX: SHL) share price faded its morning gains after opening 2.88% higher to a new all-time high of $43.95.

At the time of writing, shares in the medical diagnostics company are flat at $42.72.

Sonic Healthcare positioned to perform COVID-19 testing for vaccine passport

Sonic Healthcare has played a crucial role in pandemic control, performing ~30 million COVID PCT tests from March 2020 to date.

According to the Australian Financial Review (AFR), Sonic Healthcare is “positioning itself as the top contender to conduct the COVID-19 testing for an eventual “vaccine passport” if there is a government tender process”.

Sonic Healthcare CEO Colin Goldschmidt told the AFR that “While there has not been any signal from the government about such a tender process, at the moment the airlines are trying to co-ordinate since they don’t want COVID-19 infected travellers on the plane,”.

“It’s early days, but we are very much investigating what sort of role we can play in terms of travel passports, vaccination and testing, and then linking in with international air carriers. It’s a big and complicated area,” he said.

COVID-19 testing lifting Sonic Healthcare’s earnings

Sonic Healthcare said in its FY21 results that COVID-19 testing has enhanced its financial performance.

As a result, the company’s revenue increased 28% to $8.8 billion while net profit surged 149% to $1.3 billion.

Despite a strong financial performance, the Sonic Healthcare share price fell 2.76% to $41.65 on the day of the announcement.

One potential concern is the company’s increasing dependency on COVID-19 testing.

Sonic Healthcare flagged that COVID-19 PCR volumes were lower in the second half of the year versus the first half, but have been increasing post-year end with the spread of the Delta variant.

Sonic Healthcare share price snapshot

The Sonic Healthcare share price is up 29.91% year-to-date and 33% in the past 12-months.

The company’s shares will go ex-dividend on Tuesday 7 September for 55 cents per share. Investors can expect the dividend to be paid out on Wednesday 22 September.

The post Sonic Healthcare (ASX:SHL) share price struggles despite COVID passport positioning appeared first on The Motley Fool Australia.

Should you invest $1,000 in Sonic Healthcare right now?

Before you consider Sonic Healthcare, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Sonic Healthcare wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

More reading

3 top ASX results from week four of reporting season

Sonic Healthcare (ASX:SHL) share price hits record high at $43.43
Top brokers name 3 ASX shares to buy today

Sonic Healthcare (ASX:SHL) dividend rises 7%, share price falls after FY21 results
ASX 200 rises, NIB plummets, Sonic drops

Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Sonic Healthcare Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!