What's going on with the Xtek (ASX:XTE) share price today?

The Xtek Ltd (ASX: XTE) share price is seesawing in afternoon trade after coming out of a trading halt. Here's what the company announced.

| More on:
wondering about asx share price represented by man surrounded by question marks

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Xtek Ltd (ASX: XTE) share price is seesawing in late-afternoon trade after coming out of a trading halt. The company announced a distribution agreement and lifted the restrictions that were placed earlier yesterday.

When news broke, the Xtek share price soared to an intraday high of 62 cents. However, since then, some profit taking has taken place. At the time of writing, the defence contractor's shares are flat at 54 cents apiece.

What did Xtek announce?

According to its late-afternoon release, Xtek advised that it has signed an exclusive distribution agreement with KeyOptions Pty Ltd.

Under the deal, KeyOptions will supply Xtek with its Virolens product for sale and support in Australia, New Zealand and the Pacific independent states.

The contract will be valid for an initial period of 2 years, with year-to-year automatic renewals thereafter. Thus, for Xtek to continue its exclusivity rights, a minimum sales target must be reached within the first year.

Xtek stated that the Virolens product has been accepted by the United Kingdom Medical and Healthcare product Regulatory Agency (MHRA) for registration as an in vitro diagnostic (IVD) medical device. Furthermore, it said that an application has been lodged by KeyOptions to the Australian Therapeutic Goods Administration (TGA).

Xtek noted that revenues are dependent on obtaining approval by the TGA, and customers confirming their expressions of interests into firm orders. It also stated that the commercial opportunity is wide-ranging, however, there is no certainty on guaranteed sales.

What is Virolens?

The Virolens system is a portable floor-standing screening device that combines holographic microscopy with artificial intelligence (AI) to detect COVID-19. The product works by using a mouth swab which is placed inside a cartridge and inserted into the system.

From there, Virolens looks at the nano-scale structures of the sample using a holographic microscope. The data is analysed by AI and quickly identifies if the COVID-19 virus is present. The whole process takes up to 30 seconds with a 99.7% accurate reading based on results of an internal in-vitro validation study.

The Xtek share price has gained almost 40% in the past 12 months and is up 7% year-to-date.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News

Investor sitting in front of multiple screens watching share prices
Broker Notes

Top brokers name 3 ASX shares to buy next week

Brokers gave the thumbs up to these ASX shares last week. Why are they bullish?

Read more »

Jessica Amir
Investing Strategies

6 ASX shares to buy and hold until the next leap year

These are the stocks to store in the portfolio until the next February 29 rolls around in 2028, according to…

Read more »

A woman ponders a question as she puts money into a piggy bank with a model plane and suitcase nearby.
Share Market News

If I invest $10,000 in Qantas shares, how much passive income will I receive in 2024?

Here's what analysts are predicting from the airline operator.

Read more »

A man holding a cup of coffee puts his thumb up and smiles while at laptop.
Broker Notes

These ASX 200 shares could rise 20% to 50%

Big returns could be on the cards according to analysts.

Read more »

Modern accountant woman in a light business suit in modern green office with documents and laptop.
Value Investing

Looking for ASX value shares? Here's 1 I'd buy and 1 I'd avoid!

It's not an easy exercise to identify which stocks are undervalued and which ones are simply terrible. Here's an example…

Read more »

A young girl looks up and balances a pencil on her nose, while thinking about a decision she has to make.

Will I be buying Zip shares now the company has turned a profit?

Is now the right time to buy this BNPL stock -- or not?

Read more »

a man with hands in pockets and a serious look on his face stares out of an office window onto a landscape of highrise office buildings in an urban landscape

1 ASX dividend stock down 55% to buy right now

Here's why I think this beaten-up stock could be an opportunity.

Read more »

Three analysts look at tech options on a wall screen
Share Market News

Here's how the ASX 200 market sectors stacked up this week

ASX tech shares are on fire, leading the 11 market sectors for a third consecutive week.

Read more »