Is Alpha Pro Tech A One-Time Coronavirus Fad?
Historically, during a pandemic, the demand for personal protective equipment (PPE) tends to fade rapidly after an outbreak subsides. If the coronavirus follows the same pattern, can Alpha Pro Tech 's (NYSEMKT: APT) core revenues be safeguarded?
Alpha Pro Tech is a small-cap global manufacturer of personal protective equipment including medical face masks, face shields, and infection control suits. The company's manufacturing facility is located in Salt Lake City, Utah. In its first-quarter earnings reported May 6, its revenues grew by 47.5% to $18.2 million year over year, driven by the surging demand for PPE due to the coronavirus outbreak. Indeed, the company has been landing million-dollar deals left and right for its medical masks and shields, and between 8% to 14% of its clients are content with delivery dates stretching to 2021.
In addition, Alpha Pro Tech's bottom line recorded a 300% year over year increase to $0.39 per diluted share. At an annualized rate, its earnings per share amounts to $1.56. In other words, if the current trend continues, the company's stock may be trading for as little as 8.6 times forward earnings. As a result, the company has garnered significant interest in the investment community as to whether it can lead shareholders to riches.
Source Fool.com
