SINGAPORE (Feb 14): UOB Kay Hian and Phillip Capital are maintaining their “buy” calls on Health Management International (HMI), both with target prices of 83 cents, after the group’s 1H results for FY2018 came in line with expectations.
To recap, HMI reported a 1H core net profit of RM31 million, coming in at 52% of UOB’s full-year estimate with its earnings driven by higher revenue on the back of higher patient load and revenue intensity growth.
In a Wednesday report, UOB lead analyst Thai Wei Ying explains that the research house’s target price of 83 cents is derived from explicit 2018-22 free cashflow forecasts, a terminal growth of 2.5% – in line with Malaysia’s 10-year long term inflation rate, and WACC of 7%.
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