Following the company’s second quarter results, Industrial Alliance Securities analyst Chelsea Stellick has raised her price target on Medical Facilities Corp (Medical Facilities Corp Stock Quote, Chart, News TSX:DR).
In a research update Thursday, Stellick maintained her “Speculative Buy” rating but upped her price target on DR from $4.50 to $5.10, a price that implied a return of 39 per cent at the time of publication.
The analyst summarized the quarter.
“MFC announced its quarterly results that beat consensus posting revenue of $88.8M (iA: $91M) and EBITDA of $24.6M (iA: $16.4M). EBITDA increased 19.9% YoY with EBITDA margins of 25.4% up from 17.3% last quarter,” the analyst noted. “Operations at MFC facilities were impacted in April by COVID-19 but began rebounding in May to return to prior year levels by June. With the St. Luke’s Surgery Centre ready to accept patients this month, we anticipate a stronger H2/20 in absence of a second wave of COVID-19 and anticipate the St. Luke’s facility will operate at full capacity by Q4. We have updated the model to include the results from Q2/20 resulting in a target increase from C$4.50 to C$5.10. We are maintaining our Speculative Buy rating.
Stellick thinks DR will post Adjusted EBITDA of $79.8-million on revenue of $383.8-million in fiscal 2020. The following year, she has modeled EBITDA of $77.7-million on a topline of $389.9-million.
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