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Why Quidel Soared by Almost 8% on Monday

What happened

Shares of Quidel (NASDAQ: QDEL), a manufacturer of diagnostic products, ended Monday up nearly 8%. As Quidel's fortunes are closely tied to its COVID-19 testing kits, the stock frequently rises or sinks in response to developments in the coronavirus pandemic.

Since the number of both cases and fatalities saw a sharp rise on Monday, the company's stock is seeing renewed investor interest. But that's not the only reason for Quidel's share price surge on the day.

Image source: Getty Images.

So what

Quidel announced that it is partnering with the state of Delaware to provide a COVID-19 testing program throughout its schools. Under the terms of the deal, the healthcare diagnostics specialist will staff testing sites, manage the collection of samples, run testing operations, and report the results to the state's Division of Public Health.

The company's rapid antigen tests will be the foundation of this program.

It will be launched as a pilot in five schools offering summer classes. Following that, it can be expanded to all Delaware schools enrolling K-12 students. The program is to be optional, with parental permission required.

Quidel CEO Douglas Bryant said that with the initiative it's "introducing a complete testing-as-a-service model with a goal of detecting COVID-19 infections early and protect[ing] children, their classmates, teachers and families from potential spread."

"Every day that we shut coronavirus down will be a day that we keep classrooms open," he added.

Now what

Quidel did not disclose any financial details or projections for the Delaware schools deal. Nevertheless, even in the small state this is a big initiative, and could position the company for others elsewhere in the U.S.

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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Quidel. The Motley Fool has a disclosure policy.


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