Morgans note a strong start to the new year for Virtus Health that has resulted in lower debt and confirmation from the company that the deferred interim dividend from March 2020 will be paid in November 2020.
Medicare data (for July) although not yet available (technical issues) is expected by the broker to reflect continuing high levels of cycle numbers already seen in June. Morgans channel checks suggest continued growth in August and September with the balance of the calendar year looking solid.
The Add rating is unchanged. The target price is increased to $4.54 from $3.31, due to the broker increasing valuation multiples closer to market multiples. There were no changes to EPS forecasts.
Sector: Health Care Equipment & Services.
Target price is $4.54.Current Price is $4.34. Difference: $0.20 – (brackets indicate current price is over target). If VRT meets the Morgans target it will return approximately 4% (excluding dividends, fees and charges – negative figures indicate an expected loss).
