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Medical Facilities Corp gets new $5.10 target from Industrial Alliance

Skylight Health Group

Medical FacilitiesFollowing 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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About The Author /

Jayson is a writer, researcher and educator with a PhD in political philosophy from the University of Ottawa. His interests range from bioethics and innovations in the health sciences to governance, social justice and the history of ideas.
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