Following a trading update by Healius, Morgans lowers its sales and margin assumptions for FY22-24. Management confirmed challenging trading through May-22, with underlying earnings coming in around -20% below the consensus forecast.
The analyst points out forecasting has become difficult with ongoing covid impacts and continued PCR testing. The target price falls to $4.30 from $5.15 and the Add rating is maintained.
Nonetheless, the broker emphasises fundamentals remain strong, cost-outs are on-track and there is a growing backlog of routine care.
Sector: Health Care Equipment & Services.
Target price is $4.30.Current Price is $3.80. Difference: $0.50 – (brackets indicate current price is over target). If HLS meets the Morgans target it will return approximately 12% (excluding dividends, fees and charges – negative figures indicate an expected loss).
