Over the course of the past months, the Sorrento Therapeutics Inc (NASDAQ:SRNE) stock has come into sharp focus due to the company’s work related to the coronavirus test named COVI-TRACE. In recent months, most companies that have been working on products to tackle the coronavirus pandemic have seen their stocks record gains and in that regard, Sorrento is no exception.

What to Expect Next?

On Tuesday, the Sorrento stock rallied yet again after a well known and respected analyst made bullish comments with regards to its prospects. The stock rallied by 31% on Tuesday as investors piled on to it in light of the comments. Due to the sort of gains made by the Sorrento stock, it could be worthwhile for investors to take a closer look at the company.

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On Tuesday, analyst Raghuram Selvaraju of H.C. Wainwright maintained his buy rating on the stock and in addition to that, raised the target price to $30 a share from $24 a share. On Tuesday, the stock closed at $12.84 a share, and hence, the new target price from Selvaraju represents an upside of as much as 133% at this point.

It is a handsome return and it is no surprise that investors decided to pile on to it yesterday. It is likely that the Sorrento stock is going to continue to be in focus today and it remains to be seen if it can add to its gains today.

The analyst stated that he is bullish about Sorrento in light of the fact that the company licensed a new rapid diagnostic test for COVID 19 from Columbia University. The test can detect the presence of the virus in as little as 30 minutes and uses saliva samples instead of nasal swabs, which can often prove to be an unpleasant experience for people.

The test in question is known as COVI-TRACE and considering the fact that the coronavirus pandemic is showing no signs of abating, the demand for testing products is almost certain to rise. He went on to state that the peak forecast of the number of tests remains at 56.5 million per year and at the price of $15 per test, the total yearly sales could hit $1 billion for Sorrento. That being said, it is necessary for investors to note that Sorrento has not yet got the coveted emergency use authorization from the United States Food and Drug Administration.

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Hence, it is quite clear that the test in question is going to be evaluated more before Sorrento can hope to get the authorization. On the other hand, it should also be noted that the company is going to be competing with many other companies and many of those competitors already have their products in the market.

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