Healthscope Ltd

HSODetails
Increased reliance on private-sector hospitals: Healthscope Ltd (ASX: HSO) is the second biggest private hospital in Australia and stands to benefit from the rising reliance on private sector. As per the Australian demographic statics by ABS, a 42% drop has been observed per 1000 people aged over 65 years since 1994 in public hospitals. This creates a good opportunity for private hospital in general and HSO in particular. Rising number of people in the age group above 65 years is another reason for prosperous growth of a sector. On demand side, the management said it is experiencing similar number of patients in the first quarter of FY17 as FY16 as slower rate of growth in hospitals division is seen. HSO has an expansion plan for next few years whereby the group would expand in terms of hospital beds by FY19. The expanded capacity would add to the topline in coming years. Additionally, the stock has good dividend yield and has fallen about 26% in last three months (as at December 05, 2016), and we rate the stock as a “Buy” at the current market price of $ 2.23

 
HSO Daily Chart (Source: Thomson Reuters) 

CSL Ltd

CSLDetails
Strong product portfolio with planned new launches: CSL Ltd (ASX: CSL) has committed R&D plans for which the company is increasing its spend to $614 million for FY16 from $463 million in FY15. The R&D spend would be for new product development, market development and life cycle management.
 

CSL Ltd December R&D Portfolio (Source: Company Reports)
 
The company recently announced positive results from CSL112 phase 2b trial and is planning CSL346 – diabetes/diabetic complications and phase I is planned to commence in H2 FY2017. The company has also executed $1 billion share buyback program. However, given the prospects and the stock trading at a slightly high P/E, we feel the stock is “Expensive” at the current market price of $ 96.25

 
CSLDaily Chart (Source: Thomson Reuters) 

Sirtex Medical Ltd

SRXDetails
Exploring new technology platforms: Sirtex Medical Ltd (ASX: SRX) is currently researching new four technology platforms, namely Radioprotector, Carbon-cage nanoparticles, Polymer coated nanoparticles, and Histone inhibition program (HIP). HIP has been said to have potential for commercialization, and the group aims to move its HIP trials into Phase II stage in 2018. The key move is to obtain the potential for fast-track, orphan drug and breakthrough therapy designation by US FDA.
 
 
SRX R&D spend (Source: Company Reports)
 
The company says HIP offers multi-billion-dollar contestable market opportunities. Furthermore, Sirtex’s radioactive spheres are expected to report double digit revenue growth in FY17. SRX has spent about $10.8 million on pre-clinical or early stage research and development in FY16 and multiple clinical trials are also going-on to promote the efficacy of SIR-Spheres in treating liver cancer and related condition. Considering the growth prospects of the company, we give a “Buy” at the current market price of $ 26.04

 
SRX Daily Chart (Source: Thomson Reuters) 

Starpharma Holdings Ltd

SPLDetails
Expansion through partnerships:Starpharma Holdings Ltd (ASX: SPL) has signed a deal with Koushan Pharmed to promote and distribute VivaGel^®condoms in Iran. The company feels Iran is a lucrative market for condoms with 60% of its 75 million people of age 30 years and under. The company’s VivaGel^®brand of condoms is licensed for distribution in other countries including Canada, New Zealand and Japan, and SPL is planning to expand in more jurisdictions.
 

Starpharma Holdings diversified base (Source: Company reports)
 
The company planned for two new-targeted DEP™partnerships with leading global Antibody-drug conjugate (ADC) companies. SPL has strong cash reserves of $37.6 million as on September 2016 and reported revenues of $4.6 million and net loss of $22.7 million. The stock is trading close to its 52-week high price and we believe that the same is “Expensive” at the current market price of $ 0.74

 
SPL Daily Chart (Source: Thomson Reuters) 

Ramsay Health Care Ltd

 
RHC Details
Reaffirmed FY 17 guidance:Ramsay Health Care Ltd (ASX: RHC) had reaffirmed FY 17 guidance and expects the core NPAT and core EPS growth for the group to be 10-12%. Moreover, RHC notes the comments made about the slowing hospital admissions growth in Australia in the quarter ended September 2016. But RHC’s portfolio of hospitals continues to deliver admissions growth in line with its long-term trend. Further, ageing and growing population will help boost volumes and operations in long-term. Meanwhile, the stock is trading at a high P/E. We give a “Hold” recommendation on the stock at the current price of $ 68.00

 
RHC Daily Chart (Source: Thomson Reuters) 

Mayne Pharma Group Ltd

MYX Details
DOJ investigations: Mayne Pharma Group Ltd (ASX: MYX) in FY16 reported 89% revenue growth, while reported NPAT was up 379% over prior corresponding period owing to Doryx® franchise. The group recently launched IDT’ generic Temozolomide capsules in the US. MYX had received the subpoena from the Antitrust Division of the US Department of Justice (DOJ) seeking information relating to the marketing, pricing and sales of select generic products. The investigation was related to doxycycline hyclate delayed-release tablets (generic) and potassium chloride powders. For this, MYX has stated that it is cooperating with the DOJ in its investigation and continues to do so. MYX believes that these investigations will not have a material impact on its future earnings, however, the company does not give assurance to the timing or outcome of the investigation. Meanwhile, MYX stock has fallen 6.5% in last five days as on December 05, 2016 owing to market sentiments. We give an “Expensive” recommendation on the stock at the current price of $ 1.47

 
MYX Daily Chart (Source: Thomson Reuters)

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