ScoPo’s Powerplays: ASX health stocks flat in ‘ocean with no...

ScoPo’s Powerplays: ASX health stocks flat in ‘ocean with no breeze’
Health & Biotech

August 30, 2024 | Nadine McGrath


Nanosonics lifts on FY24 result

Power said the positive share price for the week was for disinfection device maker NAN, which lifted ~14% in the past five days on its FY24 result and was in line with expectations.

Sales revenue was up 2% to $170m, the company saw total installed base growth of 7% (2,340 units) to 34,790 units globally in FY24, while recurring revenue was up 9% to $121.8m.

NAN reported gross profit margin of 77.9% in FY24 slightly down from 78.7% in FY23, which in a note to client Morgans’ analyst Iain Wilke said reflected the change in sales mix over the year and wound-down manufacturing rate.

“FY24 results were largely known given NAN’s recent trading update so focus was on guidance, Coris updates, and signs of hospital capital budget pressures,” he wrote.

Coris is NAN’s newest device intended for flexible probes commonly used in procedures such as colonoscopies, gastroscopies, enteroscopies, endoscopic ultrasounds and bronchoscopies.

The company filed a de novo regulatory submission for Coris in April and is forecasting approval within about a year.

“While NAN has made it clear capital budget pressures remain, a modest bounce back in capital sales in H2 and positive commentary suggesting more optimism into FY25 on new sales pipeline has reignited interest in the stock,” Wilkie said.

“Likewise, FY25 guidance looks achievable, and we would expect upgrades to roll through across the year if and when the pressures abate.”

Morgans made no change to its valuation with an add rating and 12-month target price of $3.75 maintained.