hVIVO plc, a contract research organisation in the infectious and respiratory disease vaccine and therapeutics fields, has received positive coverage following today’s stellar earnings call.
The group raised its projections for the full year and announced plans to initiate dividend payments, following a doubling of profits in the first half, bolstered by a 52% surge in revenues.
hVIVO subsequently adjusted its guidance upwards to an anticipated £55 million, excluding other forms of income, with a projected EBITDA margin of approximately 19%.
“More often than not, a first-half weighting translates into a full-year upgrade, and interim results have not disappointed,” said Liberum’s healthcare-focused research analyst Edward Thompson.
He stated that “after good progress on new trial authorisations”, forecast risk has been reduced for the full year, translating to a 12% EBITDA guidance uptick from the broker.
Thompson stated that after today’s upgrades, hVIVO’s shares look “materially undervalued” on an enterprise-value-to-EBITDA ratio compared to its closest UK peer Ergomed.
Ergomed recently agreed on a £703 million private equity takeover deal.
Liberum has a buy rating on hVIVO shares with a 26.6p price target against a publication price of 19.2p.