Monash IVF Group Ltd

MVF Details
·         Resignation of CEO impacted the stock sentiment: Monash IVF Group Ltd (ASX: MVF), an assisted reproductive services’ (fertility) company, witnessed a stock price loss of over 3.8% on May 12, 2017 after their Managing Director and CEO, Mr James Thiedeman tendered his resignation after eight years of association (as CEO) with the company. James Thiedeman is moving on to work for a non-competing unlisted health care organization outside the women’s health sector with international growth plans. On the other hand, the group reported a decent bottom line for their first half of 2017 wherein the NPAT rose $1.2m (8.8%) to $15.2m as compared to prior corresponding period (exceeding guidance provided in November 2016).Demand for non-invasive pre-natal testing surged by 9.2% to 4,820 tests driven by in-house capability which started in November 2016 leading to a better patient service. The group is poised for growth considering strong fundamentals and demand scenario.

·         Recommendation: MVF stock rallied over 14% in the last three months (as of May 11, 2017) while we give a “Hold” on the stock at the current price of $ 1.99

Japara Healthcare Ltd

JHC Details
·         Positioning to leverage the growing industry demand: Japara Healthcare Ltd (ASX: JHC) stock slipped over 4.5% on May 12, 2017 as the aged care sector overall witnessed huge losses. On the other hand, JHC is aiming to attain a better position in the industry in order to leverage the growing demand at the back of increase in ageing population. The Cumulative Average Growth Rate of government funding during the fiscal 2008 to 2015 period was 8.6% and the government funding has been expected to rise going forward. The group has bought four new land purchases in FY17 and built 445 new greenfield beds in the anticipation.
 
·         Recommendation: However, the sector is highly dependent on government funding scenario. Considering the volatility seen last year and the level of uncertainty still prevailing, we maintain an “Expensive” recommendation on the stock at the current price of $ 2.14

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