AFR; Macquarie Research has determined stocks in the diagnostic...

AFR; Macquarie Research has determined stocks in the diagnostic services space are the most likely winners amid the opportunities and risks associated with the Covid-19 pandemic for the listed healthcare universe.Overall, the broker suggests most healthcare companies face downside risk as the global spread of Covid-19 lowers economic activity and increases the public's reluctance to visit transmission hotspots such as general practitioners' (GP) surgeries or hospitals.This means that healthcare providers offering elective services are more likely to suffer through a Covid-19 downturn, while diagnostic and pathology services providers are thought to be more robust.Diagnosing winnersGPs are key referral channels for pathology and diagnostic services businesses, with Sonic Healthcare, Integral Diagnostics, and Healius (the former Primary Healthcare) beneficiaries from an upturn in referrals.However, if people stop visiting the doctor out of Covid-19 transmission fears it could slow business. According to Macquarie's research those aged over 65 accounted for 27 per cent of GP visits in financial 2019 and are the age group most likely to be deterred from visiting perceived transmission hotspots.In Macquarie's eyes, the potential for lower diagnostic and pathology volumes on transmission fears is offset by greater Covid-19 related attendances at doctors that could result in more diagnostic volumes.According to the broker, the majority of Covid-19 diagnostic tests are currently being conducted in public laboratories, but this may expand across the private sector with reimbursement rates to be determined.On balance, Macquarie argues diagnostic specialists like Sonic and Integral Diagnostics could prove net winners from the virus's outbreak as there's a positive correlation between GP visits and pathology or diagnostic volumes. broker suggests Integral shares have some 27 per cent upside with a $4.55 price target and outperform rating. On market leader Sonic it has a $30 price target, with Healius's rating under restriction.