FY21 underlying results were in-line with consensus expectations, with covid testing driving upside across all laboratory businesses. There’s considered a strong outlook, given increased Delta variant testing and emerging related activities along with a solid base business.
The base testing business (ex-COVID) continues to demonstrate resilience, while Imaging posted double digit growth and market share gains offsetting modest sales softness in the pandemic-impacted Clinical Services, explains the analyst.
While covid uncertainty is likely to continue to cloud the near and medium term, Morgans believes there will likely be continued organic growth and retains its Add rating. The target price increases to $45.98 from $36.15.
Sector: Health Care Equipment & Services.
Target price is $45.98.Current Price is $41.65. Difference: $4.33 – (brackets indicate current price is over target). If SHL meets the Morgans target it will return approximately 9% (excluding dividends, fees and charges – negative figures indicate an expected loss).
