Diagnostics company SHL rallied +15.1% yesterday after beating market expectations, they delivered a profit that was 50% higher than before COVID – revenue over the last few years was elevated due to massive PCR testing, hopefully, a thing of the past. When we compare like for like in terms of earnings periods and removing the COVID anomaly, this is a business that’s firing yet it took yesterday’s pop to take the stock above its pre-pandemic levels – consumers are finally catching up on tests that were put on hold during COVID. Interestingly this was one of the rare times when the market didn’t mind a lack of guidance which tells us they were simply too bearish after an awful year for the stock.
- The stocks Est. valuation for 2023 of 21.6x is challenging in the healthcare space while its 3.1% fully franked yield is a nice bonus.
MM likes SHL around $33
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