XpresSpa Group Inc (NASDAQ: XSPA) is running for the top in the market this morning. However, with no news or SEC filings from the company, many are wondering why it’s headed up.
The gains seem to be the result of retail investors making a buzz as the company’s in-airport COVID-19 testing plans come to fruition. Here’s what’s going on:
Skip to What You Want to Read
- What is XpresSpa?
- In-Airport COVID-19 Testing Is Taking Off
- What Analysts Think About XSPA Stock
- Final Thoughts
What is XpresSpa?
For those of you who haven’t been following the company, XpresSpa is an in-airport spa company. The core business of the company banks on the fact that while consumers wait on their flights, a process that can take hours, they will want to treat themselves.
However, the company’s business model was flipped on its head as a result of the COVID-19 pandemic.
As the pandemic took hold, any business that wasn’t a necessary business was forced to shut down. While many companies put their heads in the sand, waiting for the pandemic to pass, XSPA quickly shifted focus.
The company launched a subsidiary, known as XpresCheck. Instead of providing in-airport spa services, it planned on offering in-airport COVID-19 testing facilities.
At first, the naysayers were all over the company, saying that it could never get a COVID-19 testing facility into any major airport, but XSPA quickly proved these naysayers wrong. In fact, after multiple pilot tests, the company’s COVID-19 business model is taking off.
In-Airport COVID-19 Testing Is Taking Off
Today, XSPA has multiple in-airport COVID-19 testing facilities that are operational, and it seems like every week or two, we’re hearing about new facilities that are popping up. In fact, most recently, we’ve heard about:
- March 4, 2020. On March 4th, XpresSpa announced that it had entered into an agreement to launch an XpresCheck facility at the Seattle-Tacoma International Airport.
- February 18, 2020. On February 18th, XSPA said that it entered into agreements to launch COVID-19 testing facilities at Dulles International Airport and Reagan National Airport.
- February 16, 2020. On February 16th, the company announced that it would be launching its second XpresCheck facility at Newark Liberty International Airport.
While the above are the most recent announcements, simply scrolling through the company’s Yahoo! Finance page will show you that these are just the tip of the iceberg as the company continues to aggressively expand its COVID-19 testing services to airports around the United States, and plans on pushing these services on the international stage.
What Analysts Think About XSPA Stock
Wall Street seems to have a new favorite among analysts. In fact, according to TipRanks, the company was recently picked up by a Wall Street Analyst with a Buy rating and a price target of $3.50.
While it’s never a good idea to blindly follow analysts opinions, their opinions are useful as a way to validate your own. Given the current price target on XSPA stock, there seems to be incredible potential here.
The bottom line here is simple. The COVID-19 pandemic made XSPA one of the ugly ducklings of the stock market. However, instead of letting the pandemic push it out of business, the company quickly shifted focus and give consumers what they were looking for.
That’s a strong move, one that the vast majority of companies in the industry were too afraid to make.
All told, it’s working out great for the company. We’re seeing an aggressive expansion of in-airport COVID-19 testing facilities across the United States, a trend that may continue to the international stage. As the company continues to execute, there’s no reason to expect anything but more positive momentum out of XSPA stock.