JHC - UBS rates the stock as Neutral
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The company has downgraded FY18 guidance after deciding to follow Regis Healthcare's ((RHC)) lead and refund all capital refurbishment deductions charged to residents since 2015. UBS had envisaged a risk for the company after the Federal Court ruling.
FY18 operating earnings are expected to be -14-19% below FY17. The broker continues to like the stock on a longer-term view, supported by a significant development pipeline and the potential for margin uplift through operating efficiencies. Neutral rating maintained. Target is reduced to $1.90 from $1.95.
Sector: Health Care Equipment & Services.
Target price is $1.90.Current Price is $1.96. Difference: ($0.06) - (brackets indicate current price is over target). If JHC meets the UBS target it will return approximately -3% (excluding dividends, fees and charges - negative figures indicate an expected loss).
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