The new chief executive of Spire Healthcare Group (SPI) is delivering a confident vision for the independent hospital group and Jefferies expects further upside.
Analyst James Vane-Tempest retained his buy recommendation but reduced his target price from 290p to 275p. The shares fell 1.8% to 219.6p yesterday.
2017 was a challenging year but on first impressions, the new chief executive has delivered a bold, fresh and confident vision as well as 2022 targets that we believe also leave room for upside, he said.
Vane-Tempest said that concerns over NHS contracts arent likely to abate but the mix is improving and expectations are low.
We still expect headwinds in 2018 but believe the market is too pessimistic on the rest of the business, he said."
The results should be as per the update in January. Management will be aware that they turned down a reasonable offer from Mediclinic and should have some numbers to show that the decision was correct. However I feel that the situation will be one of "jam tomorrow". I imagine there will be mention of the hard winter with Flu affecting staff and patients alike, NHS cutbacks and of course inflation. I`m still a long term holder as this business is in a growth area and will succeed under good management. Still a possibilty of a takeover given its low price.
I`m not overly surprised. It was an opportunist bid, at possibly the wrong time to get market support. I would have liked to have seen the board reject it with a strong forward business plan, as opposed to stating it was short on valuation. Long term hold was always my goal as healthcare in this country has to become more privatised.
I now expect Spire to ask for an extension on Monday. Mediclinic will have its hands tied with the current dip in its share price. I wish I had taken a small profit at £3.00. Hay ho, if it doesn`t work out I`m sure it will all be OK in a year or two. Its a long term buy for sure.
As is usual with any deal the management sit down and look after themselves and then investors. At present most long term holders will be in the black. I can`t see why we should sell for less than 320p unless there is more bad news to come from Spire. Point to note is that the interims from Mediclinic were not inspiring and the share price is not supportive at present. Spire has taken a big hit early on which shows nerves
I have a reasonably close stop loss set, got a guarantee of course but another option perhaps. I admit to being slightly nervous also....but given the amount of skin they already have in the game, (bought at a higher sp) I still think they will up their offer, but WDIK.
I expect with the market turning down and some IPO`s being postponed that Mediclinic will feel they have the upper hand. They will know the exact state of Spires positition and will offer about 330p in cash and shares. I would expect this to happen over the weekend. If the deal falls through then expect to see 200p, which is a buying opportunity IMHO
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