The curve is flattening. The shutdown phase of the COVID-19 pandemic is almost over. The next step, testing, is being queued up, observes technology expert Jon Markman, editor of Pivotal Point.

To reopen the economy safely, we need more testing to accurately determine who is infected and who is safe to be in the community.

Unfortunately, only a tiny number of businesses have the expertise to deliver high-quality tests. One business that’s going to reap the biggest benefits of this is Danaher (DHN). Its wholly owned subsidiary, Cepheid, won emergency approval from the Food and Drug Administration for its COVID-19 test in March.

Known as Xpress SARS-CoV-2, it’s a molecular diagnostic test that works with Cepheid’s fully automated GeneXpert system. The system consists of cartridges and an automated diagnostic machine — about the size of an inkjet printer — that can provide onsite test results in about 45 minutes.

But there’s more to this test than just speed. The real advantage of this system, according to a March press release, is that the components are already installed in 5,000 American hospitals.

This foothold is the logical place to test essential workers, and it is likely to be repeated all over the country. For Danaher, it’s a license to print money.

Danaher is a global diversified conglomerate. It operates in four major segments: life sciences, environmental and applied materials and diagnostics. The $4 billion acquisition of Cepheid in 2016 fortified its testing portfolio.

Cepheid is a relatively small Silicon Valley company. While its diagnostic systems are cutting edge, the testing cartridges require reagents and nucleic acids that are in short supply globally. Integrated DNA Technologies, another Danaher company, has direct access to those supply chains.

In terms of sales, the testing phase is going to be a game-changer for diagnostic companies with proven technologies and the scale to produce tests.

The stock trades at 28.3 times forward earnings and 6.4 times sales. These are reasonable metrics for a well-managed company set to win big in the COVID-19 testing sweepstakes. Growth-oriented investors should consider accumulating Danaher shares into pullbacks.

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