The Medicare data as at the end of last year depicted a better scenario in terms of IVF trends, in Australia. Further, IVF and weight loss surgery have been identified as key reasons for people who have been lately seen to raid their superannuation early on to take care of the health bills. Below is a view on 2 IVF stocks amidst this scenario:
 

Stocks Details
 

Virtus Health Ltd

Financial performance broadly in line with VRT’s expectations in the first four months of FY18: Virtus Health Ltd (ASX: VRT) stock has fallen 7.28% in last three months as on January 18, 2018, and was removed from S&P/ASX All Australian 200 Index, effective from December 18, 2017. On the other hand, VRT in the first four months of FY18 had financial performance broadly in line with the company’s expectations. In the first quarter, the Australian Assisted Reproductive Services market (available to VRT) has posted volume growth of 5.4% primarily due to a significant growth in the low-cost sector in Queensland, resulting in a loss of market share for VRT in that state. On the other hand, the company’s growth in NSW and Victoria has exceeded market growth during this period. Further, the efforts on cost savings in terms of restructuring are expected to yield some increase in earnings. With an expectation of some bit of stock recovery in view of a reasonable price to earnings level and group position in the market, we give a “Hold” recommendation on the stock at the current price of $5.22
 
 

Monash IVF Group Ltd

Weak 1H FY18 Outlook: Monash IVF Group Ltd (ASX: MVF) stock has fallen 14.15% in three months as on January 18, 2018 as in the first quarter of FY18, MVF’s Australian stimulated cycles market share fell by 2.5% representing a 6.6% decline in the stimulated cycles. Further, MVF and its 32 Victorian based clinicians have implemented the plan to reduce the impact of a departing high-volume clinician in Victoria and is focused on providing a smooth transition and continuity of excellent care for the patients. The speed of the patient transition will negatively impact the financial performance during 1H FY18 while an effect from the non-compete period ending by FY19 is being anticipated. Additionally, MVF expects the reported NPAT for 1H FY18 to be approximately 20% down on the previous corresponding period. On the other hand, the return on equity and dividend scenario is something that cannot be ignored despite the weakness. We thus give a “Hold” recommendation on the stock at the current price of $1.36

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