Monash IVF Group

MVF Details

Clarified on the problem with doctors:  Monash IVF Group Ltd (ASX: MVF) stock declined over 21.5% in the last three months (As of August 14^th, 2017) due to weak investors sentiment. An article from Australian Financial Review cited that the group has “Ongoing Problem” with their doctors. Moreover, the group’s managing Director and CEO, Mr James Thiedeman gave his resignation to take up a leadership role in a non-competing unlisted health care organization outside the women’s health sector with international growth plans. On the other hand, the group immediately reacted to this article and said that their staff, doctors and nurses work together. Moreover, the group and Dr Lynn Burmeister agreed to resolve all issues in dispute between them.  This includes the current proceedings in the Supreme Court of New South Wales and in the Supreme Court of Victoria.We give a “Hold” recommendation on the stock at the current price of $1.64


MVF Daily Chart (Source: Thomson Reuters)

Virtus Health Ltd.

VRT Details

Decent dividend yield: Virtus Health Ltd (ASX: VRT) is among a major fertility business in Australia but faced a challenging first half of 2017 on the back of weak domestic conditions hurting revenue & earnings. As a result, Virtus’ available markets contracted 6% in the first half of 2017 while Virtus fresh cycle activity in Australia lost 7.2% on a like for like basis. Victoria markets volume weakness hurt the performance while NSW TFC volume (which accounts 12% of Virtus NSW business) lost 19%.  EBIITDA lost 12.3% to $31.7 million (Australian segment lost 13.1% while International segment rose 11.7% against pcp). Australia Day Hospitals revenue fell 10.5% on the back of Australian ARS market and lower activity in elective procedures hurting private health care during the same period. Non-IVF procedure revenue represents 42.0% of their total day hospital revenue, which fell from 43.9% in pcp. Total expenditure on tangible and intangible assets lost to $4.6 million in the first half of 2017 from $4.9 million in prior corresponding period. On the other hand, their international operations reported ongoing growth with segment EBITDA rising 11.7%, on track with their international expansion strategy. Ireland delivered continued cycle and earnings growth which rose EBITDA by 3.5%, while Singapore reported a better EBITDA performance. Aagaard integration, which is Denmark’s leading fertility provider outside Copenhagen in November 2016, would boost their European business. Diagnostic services contribution enhanced with revenue up 7.1% on pcp, even though Australian ARS and broader pathology markets faced pressure. Moreover, Advanced Preimplantation genetic screening and diagnostics tests surged 37.9% yoy against the pcp. Virtus advanced technologies implementation across their fertility business would be a major contributor to improving patient success rates and offering services to both fertile and infertile patients. They made a largest investment related to the continued development and rollout of the company’s patient management software in Australia. We give a “Hold” on this 5% dividend yield stock at the current price of $5.66


VRT Daily Chart (Source: Thomson Reuters) 

Ramsay Health Care Ltd.

RHC Details

New management: Ramsay Health Care Limited (ASX: RHC) recently reported that they are taking their obligations under the Competition and Consumer Law seriously and has worked cooperatively with the ACCC during its investigation into a matter in Coffs Harbor. The group reported a distribution Amount of AUD 2.38 payable on October 20, 2017. Meanwhile, the rising ageing population in the coming years would be the major driver for the group’s business. NHS wait times and lack of NHS capital for capacity expansion is also an opportunity to Ramsay who are well positioned to invest in capacity expansion and seek out new opportunities. UK is a major Independent Sector provider of acute NHS services. The group’s market share was maintained despite rising focus by competitors. Recently, the group appointed Craig McNally, as the Managing Director and Chief Executive Officer, succeeding Chris Rex, from last month. Craig McNally was earlier the Chief Operating Officer of the group. We recommend a “Hold” on the stock at the current price of $72.84
 

RHC Daily Chart (Source: Thomson Reuters)

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