[Featured Stock] SuzenTec, Anticipates 'Dream Operating Profit Margin'... US COVID-19 Cases at Record High, Uncontrollable

[Asia Economy Reporter Hyungsoo Park] SuzenTech is showing strong performance. The news that the daily new confirmed cases of COVID-19 in the United States exceeded 65,000, setting a daily record, seems to be influencing the stock price. According to Johns Hopkins University's COVID-19 tally on the 9th (local time), a total of 65,551 new infections were reported in the US over the past 24 hours.

As of 12:04 PM on the 10th, SuzenTech is trading at 29,200 KRW, up 8.75% from the previous day.

Sylvester Turner, mayor of Houston, Texas, said, "The coronavirus situation in this city and state is out of control," adding, "What we need to do today and in the coming weeks is to bring this virus back to a controllable state."

With COVID-19 not subsiding and growing concerns about a second wave this fall, demand for COVID-19 diagnostic devices is expected to increase through the second half of this year and into next year. As the number of confirmed cases in the US rises, expectations are growing that domestic diagnostic companies' export volumes will increase.

Researcher Junho Yoon of Meritz Securities explained, "COVID-19 diagnostic methods are divided into molecular diagnostics and immunochemical diagnostics," adding, "Molecular diagnostics require various PCR devices for genetic testing of antigens."

He continued, "Molecular diagnostics are accurate but have limitations in detecting the virus in asymptomatic cases and require additional time to use analytical equipment," adding, "In emerging countries without molecular diagnostic PCR infrastructure, antibody diagnostics have the advantage of enabling on-site testing."

SuzenTech began expanding its production capacity in March in response to increased demand. Production increased from 50,000 units per week at the end of March to 2 million units per week by May. The company is maintaining a production system of 2 million units per week.

Researcher Gyuri Kim of Shinhan Financial Investment said, "We expect better performance in the third quarter compared to the second quarter," explaining, "Because shipment volumes for three months are reflected in the results." She added, "The cost of goods sold ratio is only about 10%," and "Even considering fixed selling and administrative expenses and logistics costs, an operating profit margin of over 70% is expected."