Tag: RHC

The broker maintains its $80 target price. The Hold rating is unchanged.

Buy rating retained while the target price loses -$1 to $74.00.

Target rises to $67.69 from $65.10, Hold retained.

Neutral rating with a $70 target price maintained.

Credit Suisse expects Ramsay Healthcare should be a beneficiary of a volume tailwind post covid and its $69 target price and Neutral credit rating.

APRA data has revealed benefits paid to private hospitals declined -3.3% in the December quarter. UBS retains a Neutral rating and $69.90 target.

UBS expects operating earnings in the first half of $971m, down -8%. The broker retains a Neutral rating and reduces the target to $69.90 from $71.20.

After a trading update by Ramsay Health Care, Morgans believes the near-term outlook is increasingly challenged as the pandemic makes forecasting difficult.

UBS notes larger private hospitals and not standalone day hospitals dominate when it comes to day stay services. The broker highlights according to data from 2019, of the circa $10bn paid by private health insurers to private hospitals, about 21% went to fund day stays out of which the share of day admissions within private hospitals was about 16%.

Population growth forecasts were revised down over 2021-23 in the federal budget as a result of declining net overseas migration (border closures) and a declining fertility rate with families delaying having children amid the uncertainty associated with covid-19.

UBS has quantified the volume of non-urgent elective surgery that was likely deferred across Australia during the peak of the pandemic-related restrictions.

Public hospital elective surgery data for the four major states indicates, in aggregate, the number of people waiting surgery increased 9% in the March quarter.

The broker has looked at the SARS event to provide a guide to when elective surgery may be able to start up again, but the problem is SARS was all over quite quickly and thus provides little precedent for Covid-19.

Ramsay’s UK NHS admissions rose 1.8% year on year in August — a good result, the broker notes, given an 8.0% increase in FY19 — however 12-month rolling growth eased to 3.0% from 3.4%. Current admissions and a tariff increase bode well for NHS revenue in FY20, but the increased use of agency nurses to handle the workload reduces margin expectations, the broker points out.

The outlook for private hospital volumes and prices remains the key driver of Ramsay Health Care, UBS assesses. Australia represents around 78% of the FY20 earnings (EBIT) forecast.

Since the beginning of August the stock has underperformed the healthcare sector by -11% and the broader market by -9%, Credit Suisse observes.