Macquarie reviews the near-term growth assumptions and assumes a less substantial impact from the pandemic. The broker believes Healius is positively leveraged to improved activity levels heading into FY21.
The company has highlighted the potential divestment of its medical centres, and if proceeds are used to repay debt Macquarie calculates this would reduce pro forma gearing to 1.5x from 2.7x.
Rating is upgraded to Outperform from Neutral and the target is raised to $3.00 from $2.70.
Sector: Health Care Equipment & Services.
Target price is $3.00.Current Price is $2.54. Difference: $0.46 – (brackets indicate current price is over target). If HLS meets the Macquarie target it will return approximately 15% (excluding dividends, fees and charges – negative figures indicate an expected loss).
