Sonic (ASX:SHL) share price hits 52-week high amid COVID booster change

Sonic shares are rising after the rules on COVID booster eligibility were changed.

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a medical person in full protective clothing holds a tray of Covid-19 vaccinations amid a haze caused by cold and ice.

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The Sonic Healthcare Ltd (ASX: SHL) share price has hit a 52-week high amid a rule change regarding when Aussies are eligible to get their COVID-19 booster vaccination.

Sonic says its staff perform crucial frontline roles in combating the pandemic, with its laboratories testing tens of thousands of people every day for COVID-19. In mid-November, it had performed 36 million COVID-19 PCR tests in total around the world to that date, as well as conducting COVID-19 serology testing and, in some markets, whole genome sequencing to help identify variants.

In Australia, it’s also the largest non-government COVID vaccination provider. In the middle of November 2021, it had provided more than 1 million COVID vaccinations.

COVID booster change

According to reporting by various media, such as The Guardian, the amount of time between COVID vaccinations will be reduced to four months from 4 January and then it will be reduced to three months on 31 January, based on updated advice from the Australian Technical Advisory Group on Immunisation (ATAGI).

Greg Hunt, the health minister of Australia, said the country should today pass the 2 million mark for boosters given. According to The Guardian, he said:

It’s no surprise we will be bringing forward the eligibility for the booster dose to four months as of 4 January. The planning behind that is that will open up a new cohort. Currently that means that we will go from about 3.2 million people who are eligible today to approximately 7.5 million who will be eligible as 4 January. That means that the cohort has expanded.

It will be expanded again on the 31st of January to three months and that will take it out to 16 million Australians who will be eligible at that point in time and as we have said all along, eligibility is the beginning of access, it doesn’t mean that somebody is overdue the very day they become eligible.

These dates have been set out of an abundance of caution to give Australians early continued protection and the advice we have is that the protection as it is is very strong against severe illness, but what we’ll see is a much stronger protection against transmission.

What could this mean for COVID and the Sonic share price?

However, whilst the ATAGI has approved the change in the booster dates, it said in a statement that booster vaccinations alone will not be enough to stop a huge surge of COVID-19 due to Omicron.

It said:

ATAGI expects that booster vaccination alone will not be sufficient to avert a surge due to Omicron. However, maximising booster coverage by expanding eligibility and encouraging high uptake, in combination with enhanced public health and social measures, may prevent a large surge in case numbers, hospitalisations and deaths. ATAGI also acknowledges the demands that the booster and paediatric COVID-19 vaccination programs will have on the immunisation workforce.

Sonic’s share price, profit and revenue seemingly continues to be partly impacted by the level of testing that it’s doing.

Over the last month, the Sonic share price has risen 11% as Omicron infections multiply.

In the four months to October 2021, before this surge of Omicron, Sonic’s revenue had grown 5% and earnings before interest, tax, depreciation and amortisation (EBITDA) had risen 16% as it benefits from operating leverage.

The base business, which excludes COVID-19-related services and is predominately pathology, continues to grow. It was up 6% in the first four months of FY22.

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Sonic Healthcare Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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