Primary Health Care Ltd

                  PRY Dividend Details
 
Subdued Outlook: Primary Health Care Ltd (ASX: PRY) recently reported a weak FY16 outlook, as the group now forecasts a 5% lower underlying NPAT against FY15. Primary Health’s Medical Centers division revenue growth is subdued due to halt of indexation of Medicare rebates as well as decrease in Healthcare Practitioner numbers. Moreover, rate cuts to Vitamin D and other tests would pose pressure on the group’s Pathology revenues growth. Diagnostic Imaging revenue growth is also lower due to regulatory uncertainty and referral patterns impact. Meanwhile, the group is enhancing its performance across its Imaging network by reducing operation costs as well as closing underperforming sites.  Primary Health also reported a decent revenue and net profit after tax increase of 6.2% and 19.1% respectively to $1.6 billion and $136.5 million during fiscal year of 2015. The company launched its bulk-billed IVF offering in July 2014 that provides an affordable and accessible service. But PRY stock has been under pressure this year and plunged over 34.31% (as of December 03, 2015) during this year to date while decreased over 15.36% in the last four weeks alone. We give an “Expensive” recommendation on the stock at the current price of  $3.10
 
 
PRY Daily Chart (Source: Thomson Reuters)
 

Monash IVF Group Ltd

                     MVF Dividend Details
 
Improving market share: Monash IVF Group Ltd (ASX: MVF) stock price fell to an all-time low value of about $1.06 in the month of August 2015 due to rumors on the group’s over its doctors concern about patient care in MVF. But, the stock immediately recovered post the group’s clarification about the improper rumors and surged over 20.24% in the last three months (as of December 04, 2015). Recently, Monash IVF reported that they witnessed a solid rebound in long-term Assisted Reproductive Services (ARS) market growth rates during the first quarter of FY16, which would boost its overall revenues and total patient treatments. MVF total patient treatments increased over 18.5% during the four months ended to October 15 as compared to the prior corresponding period (pcp). Management expects its reported NPAT to improve over 25% during first half of 2016 against pcp. The domestic major markets of patient treatments improved by 5.6% on a year over year basis. The group also enhanced its overall ARS market share to 41.3% during the year to date of October 2015 as compared to 39.8% in prior corresponding period. MVF performed better than the overall industry growth rates at Victoria, South Australia and Queensland. Meanwhile, MVF’s overall Australia ARS market share enhanced to 24% during year to date till October 2015 as compared to 21.9% in the corresponding period of last year.
 

Market Leader in Monash IVF Group (Source: Company reports)
 
The group is also enhancing business via acquisitions, and acquired Bondi Junction in 2014 to boost its NSW presence. With the acquisition of Sydney Ultrasound for Women, the group added 11 practices across Sydney and integrated with Monash Ultrasound. The acquisition of BUMP IVF clinic in Sydney and KL Fertility in Malaysia would further boost MVF growth in the coming periods. We believe MVF stock is trading at reasonable valuations, with a P/E of 16.7x and has an annual dividend yield of 4.5%. We recommend a “Speculative Buy” on the stock at the current price of  $1.515
 
 
MVF Daily Chart (Source: Thomson Reuters)
 

Virtus Health Ltd

    VRT Dividend Details
 
Building business through acquisitions: Virtus Health Ltd (ASX: VRT) reported an ongoing growth of Virtus fresh cycle activity in Australia during the first quarter fiscal year of 2016, which rose by 6.6% driven by acquisitions’ contribution. The group acquired Independent Diagnostic Services a Sydney based general category pathology laboratory, with a revenue of $2.9 million for the FY15 to enhance its specialist diagnostics capabilities and leverage IDS network of seven collection centers at southern suburbs of Sydney. VRT reported a volume growth in NSW, as well as Queensland but Victoria market underperformed during the first quarter. Meanwhile, the underlying Sims Clinic growth in Ireland improved by 10.2% during the quarter against comparative period in prior year. VRT’s Singapore business is achieving 20 cycles per month, while breakeven is volume of 30 cycles per month. The group is also focusing on United Kingdom and South East Asia markets to strengthen its international presence.
 

Virtus operations overview (Source: Company reports)
 
Virtus  continues to be in the forefront in Australia with over 37% market share while the fertility centers’ revenues improved more than estimated. VRT Australia’s IVF services boosted its total Virtus IVF cycles to 17,064 in FY15 as compared to 15,021 in the fiscal year of 2014 (which includes contribution from TasIVF acquisition). On the other hand, the shares of VRT surged over 23.33% in the last three months (as at December 04, 2015), and we believe the positive momentum would continue given the rising demand in Australia coupled with ongoing efficiency initiatives by Virtus. The stock is trading at a P/E of 17.29x and has a dividend yield of 4.2%. Accordingly, we reiterate our “BUY” recommendation on the stock at the current stock price of  $6.45
 
 
VRT Daily Chart (Source: Thomson Reuters) 

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