Opinions Michael Decter
Akumin Inc.AKU.TOTOP PICKJun 11, 2018
Michael DecterOwned
$4.15
Stock price when the opinion was issued
$0.53
As of Feb 01, 2024. Market Open.
medical services
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HOLD
A frustrating position. Imaging clinics in the US. Performing well and acquiring clinics. Higher margins than peers. Positive news has come out, so the rest of the year should be better, closing the gap in the valuation. Generating free cashflow and paying down debt. Alzheimer's drug will push organic demand for scans.
James TelfserOwned
medical services
BUY
A past top pick. It's the second-largest US imaging diagnostics clinic operator. They have a large presence in Texas and Florida which are reopening. AKU is rebounding from last year, when they kept margins strong. Revenue growth has rebounded well as well as volume growth. They weathered 2020 lockdowns well. Their last quarter changed accounting practices, which confused the street, but that's straightened out now. A positive outlook.
James TelfserOwned
medical services
PAST TOP PICK
(A Top Pick Jan 22/20, Up 3%) Operates MRI clinics in the US. Hurt by pandemic in organic revenue growth, but managed well through it. Still a great story.
James TelfserOwned
medical services
TOP PICK
At an inflection point. Technology, right clinics, and right billing cycle to drive free cashflow, which is the lifeblood to being a consolidation play. US institutions are interested in it. Demographics are in their favour, a massive tailwind. No dividend. (Analysts’ price target is $5.24)
James TelfserOwned
medical services
PAST TOP PICK
(A Top Pick Oct 15/19, Up 20%) Operates MRI clinics in the US. Now second largest in the US. Can consolidate and grow. Substantial margins in the mid-20s. Impressive management team. Still likes it at these levels.
James TelfserOwned
medical services
BUY
The company has MRI clinics in the US. It has over 100 clinics now. He thinks it is a fantastic buy at this level. The challenge is their balance sheet, because of their unfortunate timing of an acquisition just as the pandemic hit. He thinks they will manage it just fine. Margins will be strong when things return to normal for this small cap.
medical services
HOLD
He's long owned this. They run diagnostic imaging centres in the U.S. They charge half what hospitals do, which is attracting businesses. AKU has one big competitor in the U.S. that is twice the size of AKU. He believes the competitor will one day buy AKU. He'll wait 18 months for this take-out to happen.
Michael DecterOwned
medical services
TOP PICK
Investors don't recognize its value. It can grow inorganically in this environment. A solid business that operates medical MRI clinics, the number two player in the U.S. Payout rates have been very stable. Free cash flow will turn around this year. This should do well this year and boasts a lot of upside. Also, a cheap valuation. (Analysts’ price target is $5.69)
James TelfserOwned
medical services
TOP PICK
He picked this last time. It's a great growth-by-acquisition story, buying up medical scanning businesses in Florida and Texas. They're expanding margins to around 25%. They reported a fine quarter lately. Many people are getting MRI scans; hospitals charge a lot for this and insurers are encouraging insurance holders to get these scans in hospitals. AKU is are consolidating what they have now, and they will continue to buy more companies in the years to come. (Analysts’ price target is $7.52)
James TelfserOwned
medical services
TOP PICK
Management team has done a good job in MRI and CT scan clinics in the US. Pretty good market with higher margins than closest competitor. Point of inflection to becoming a big consolidator. No dividend. (Analysts’ price target is $5.92)
James TelfserOwned
medical services
TOP PICK
They do diagnostic imaging work all in the US, though it's a Canadian company. They're #2 in American diganostic imaging centres. They keep growing. He only wishes the CEO would speak to investors more. (Analysts’ price target is $7.83)
Michael DecterOwned
medical services
TOP PICK
It hasn't been getting love. Its business is in the U.S. They've executed very well. They operate MRI and CT scan clinics, as one of the biggest players in the States. They're in a 20% EBITDA business. Aging demographics are a huge tailwind, and Americans prefer going to clinics than pricier hospitals. (Analysts’ price target is $5.92)
James TelfserOwned
medical services
BUY
A longtime favourite of his. AKU is a consolidator of imaging centres (x-rays, CAT scans, MRIs) at outpatient centres. There are bigger competitors, but they're trading at a higher 9x multiple than AKU. AKU trades around 8x. Today's acquisition was at 7x and addeds $30 million more EBITDA. There's still lots of consolidation to go in the U.S. So AKU can keep buying. Lots of runway ahead.
Michael DecterOwned
medical services
Akumin on the TSX will migrate to NASDAQ which will be a big catalyst. It trades in U.S. dollars. They're a medical imaging company, a space ripe for consolidation. AKU is also in artificial intelligence. (Analysts' price target: $6.00)