There are signs of light in the desert but clouds are gathering in the mountains, said JP Morgan Cazenove, waxing lyrical about Mediclinic International Plc (LON:MDC).
The clouds in the (Swiss) mountains are evidently blocking out the sun in the (UAE) desert, because Cazenove downgraded the private healthcare provider to “neutral” from “overweight”.
The price target has been slashed from 898p to 733p.
The broker said Mediclinic’s half-year (H1) statement was “again disappointing”.
The United Arab Emirates (UAE) business might be recovering but the Swiss and Southern African operations appear to be under greater pressure.
Cazenove expects the current financial year to be tough and next year will probably be tough as well, and there are few near-term share price catalysts.
“Nonetheless the assets are well invested and in our view there is fat in the business, creating options. We continue to see longer-term value and believe MDC is oversold but uncertainties remain and investor patience will likely be required,” the broker suggested.