Analysts cut PT on Australia's Healius after dismal trading update

Lighting Science

28/11/2022 21:44

** Analysts trim PT, EPS estimates for Australia's
healthcare co Healius Ltd  HLS.AX  after disappointing YTD FY23
trading update
    ** Jefferies downgrades HLS to "underperform" from "hold";
cuts PT to A$3.00 from A$3.90
    ** Citi trims PT to A$3.40 from A$3.75, maintains "neutral"
rating
    ** Jefferies says co's trading update highlighted cost 
issues as BAU (business as usual) employee cost base increased
compared to pre-COVID while COVID testing declined into FY23 YTD
    ** Jefferies adds decreasing this cost will be a key focus 
2HFY23 onwards 
    ** Jefferies believes it will be hard to achieve cost-out in
the short-term, given the high fixed cost nature of Australian
healthcare services    
    ** Citi says industry profitability is likely to remain
below pre-COVID until BAU volumes recover
    ** Jefferies cuts FY23 EPS estimate by 58% and Citi trims it
by 57%
    ** 4 of 7 analysts rate stock "buy" or higher, 7 hold and 3
rate it "sell" or lower; median PT is A$3.51 - Refinitiv data
    ** As of last close, stock down 42.6% this year
 (Reporting by Himanshi Akhand in Bengaluru)
 ((Himanshi.Akhand@thomsonreuters.com;))