Jefferies sees inflationary pressures weighing on Sonic Healthcare, cuts PT

Sonic Healthcare

24/11/2022 01:28

** Jefferies says Australia's healthcare provider Sonic
Healthcare Ltd  SHL.AX  may face an earnings downside from
near-term inflationary pressures, notes all SHL geographies saw
sequential volume declines in COVID-19 testing 
    ** Jefferies cuts SHL's price target to A$34.20 from
A$36.50; downgrades rating to "hold" from "buy" 
    ** Brokerage expects lower COVID-19 testing demand through
fiscal 2023 in all geographies with testing volumes declining by
 32% in Australia from a year ago 
    ** Says base business clinical lab revenue for SHL increased
6.7% in FY23 
    ** Says SHL's FY23 estimates EBITDA forecast is A$1,778
million  ($1.20 billion)
    ** Five of 15 analysts rate the stock "buy" or higher, six
"hold" and four "sell" or lower; their median PT is A$34.20 –
Refinitiv Eikon data 
    ** Stock down 30.9% this year as of last close 
($1 = 1.4824 Australian dollars)
 (Reporting by Udbhav Krishna P in Bangalore)
 ((UdbhavKrishna.P@thomsonreuters.com;))