Pro Medicus Limited
1Ratios such as P/E, EPS, ADY are on Trailing Twelve-Month basis, which are subject to change based on certain factors such as company performance, and stock price changes.
2ROE has been taken for the Half-Year Ending December 2021.
PME Details
Business Updates: Pro Medicus Limited (ASX: PME) is engaged in the development and supply of software and IT solutions to the Public and Private Health sectors. The below picture gives an overview of the key business updates:
Business Updates (Source: Analysis by Kalkine Group)
1HFY22 Summary: The below picture provides an overview of the company’s performance during the half-year ended 31 December 2021:
Financial Summary (Source: Analysis by Kalkine Group)
Key Risks: The company is exposed to risks arising from the uncertainties in relation to the COVID-19 pandemic, rising competition from peers and regulatory risk, etc.
Outlook: Looking forward, the company’s growth strategy mainly revolves around expanding its footprint through new clients, transaction growth from existing clients, new product offerings and extending to new geographical markets.
Valuation Methodology: P/E Multiple Based Relative Valuation (Illustrative)
Source: Analysis by Kalkine Group
*% Premium/(Discount) is based on our assessment of the company’s NTM trading multiple after considering its key growth drivers, economic moat, stock's historical trading multiples versus peer average/median, and investment risks.
Stock Recommendation: The stock of PME is trading below its 52-week low-high average of $38.230 - $70.000, respectively. The stock has been corrected by ~13.07% in the past three months. The stock has been valued using a P/E multiple-based illustrative relative valuation method and arrived at a target price of low double-digit (in percentage terms). The company might trade at a slight discount to its peers, considering the COVID-19 Uncertainties and rising expenses, etc. For valuation, a few peers like Nanosonics Ltd (ASX: NAN), Fisher & Paykel Healthcare Corporation Ltd (ASX: FPH), and Cochlear Ltd (ASX: COH) have been considered. Considering the expected upside in valuation, rising revenue and earnings, signing and renewal of contracts, optimistic outlook, and current trading levels, we recommend a ‘Buy’ rating on the stock at the closing market price of $39.310, down by ~0.279% as of 16 June 2022.
Markets are trading in a highly volatile zone currently due to certain macroeconomic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.
PME Daily Technical Chart, Data Source: REFINITIV
Nanosonics Limited
1Ratios such as P/E, EPS, ADY are on Trailing Twelve-Month basis, which are subject to change based on certain factors such as company performance, and stock price changes.
2ROE has been taken for the Half-Year Ending December 2021.
NAN Details
Q3FY22 Updates: Nanosonics Limited (ASX: NAN) is engaged in the research, development, and commercialisation of innovative technologies in infection control and decontamination. The following picture provides an idea of the Q3FY22 highlights:
Q3FY22 Updates (Source: Analysis by Kalkine Group)
Key Risks: The company is exposed to risks arising from a global pandemic, forex headwinds and stiff competition in the market in which it operates.
Outlook: The company anticipates total revenue for FY22 to be in line with the current market consensus. In addition, NAN’s strategic priorities include product expansion and maintaining a strong financial position to support growth.
Valuation Methodology: EV/Sales Multiple Based Relative Valuation (Illustrative)
Source: Analysis by Kalkine Group
*% Premium/(Discount) is based on our assessment of the company’s NTM trading multiple after considering its key growth drivers, economic moat, stock's historical trading multiples versus peer average/median, and investment risks.
Stock Recommendation: The stock of NAN is trading near its 52-week low level of $2.950, offering a decent opportunity for accumulation. The stock has been corrected by ~17.75% in the past month. The stock has been valued using an EV/Sales multiple-based illustrative relative valuation method and arrived at a target price of low double-digit (in percentage terms). The company might trade at a slight discount to its peers, considering the COVID-19 Uncertainties and lower margins, etc. For valuation, a few peers like Integral Diagnostics Ltd (ASX: IDX), Polynovo Ltd (ASX: PNV), and Next Science Ltd (ASX: NXS) have been considered. Considering the expected upside in valuation, growing installed base, decent business performance in Q3FY22, optimistic outlook, current trading levels, and key risks associated with the business, we recommend a ‘Speculative Buy’ rating on the stock at the closing market price of $2.970, down by ~0.668% as of 16 June 2022.
Markets are trading in a highly volatile zone currently due to certain macroeconomic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.
NAN Daily Technical Chart, Data Source: REFINITIV
Estia Health Limited
1Ratios such as P/E, EPS, ADY are on Trailing Twelve-Month basis, which are subject to change based on certain factors such as company performance, and stock price changes.
2ROE has been taken for the Half-Year Ending December 2021.
EHE Details
Appointment of CEO & MD: Estia Health Limited (ASX: EHE) is in the provisioning of services in residential aged care homes in Australia. As announced on 26 April 2022, EHE announced the appointment of Sean Bilton as the new Chief Executive Officer and Managing Director (CEO & MD). Sean Bilton would commence his role on 11 July 2022.
Insights of 1HFY22: The below picture provides highlights of the company’s performance in 1HFY22:
Financial Summary (Source: Analysis by Kalkine Group)
Key Risks: The company is exposed to a more complex regulatory environment; any failure in compliance could lead the business to fines, penalties, etc. In addition, the business could be affected by competition from peers and other macroeconomic risks like the COVID-19 pandemic.
Outlook: Looking forward, EHE is focused on revenue diversification opportunities through reablement clinics and review home care and other adjacencies. EHE believes that its substantial land assets may support growth and security. The company has scheduled to release FY22 results on 23 August 2022.
Valuation Methodology: P/E Multiple Based Relative Valuation (Illustrative)
Source: Analysis by Kalkine Group
*% Premium/(Discount) is based on our assessment of the company’s NTM trading multiple after considering its key growth drivers, economic moat, stock's historical trading multiples versus peer average/median, and investment risks.
Stock Recommendation: The stock of EHE is trading near its 52-week low level of $1.925, offering a decent opportunity for accumulation. The stock has been corrected by ~7.75% in the past month. The stock has been valued using a P/E multiple-based illustrative relative valuation method and arrived at a target price of low double-digit (in percentage terms). The company might trade at a slight discount to its peers, considering the COVID-19 Uncertainties and negative net margins, etc. For valuation, a few peers like Regis Healthcare Ltd (ASX: REG), Summerset Group Holdings Ltd (ASX: SNZ), Pacific Smiles Group Ltd (ASX: PSQ), and others have been considered. Considering the expected upside in valuation, rising revenue, optimistic long-term outlook, current trading levels, and key risks associated with the business, we recommend a ‘Speculative Buy’ rating on the stock at the closing market price of $1.985, down by ~1.732% as of 16 June 2022.
Markets are trading in a highly volatile zone currently due to certain macroeconomic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.
EHE Daily Technical Chart, Data Source: REFINITIV
Note 1: The reference data in this report has been partly sourced from REFINITIV.
Note 2: Investment decisions should be made depending on the investors’ appetite for upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the Valuation has been achieved and subject to the factors discussed above.
Technical Indicators Defined: -
Support: A level where-in stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest.
Resistance: A level where-in stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
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