In a report released yesterday, Richard Close from Canaccord Genuity maintained a Buy rating on Quipt Home Medical (QIPT – Research Report), with a price target of $4.00.
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Richard Close has given his Buy rating due to a combination of factors that suggest Quipt Home Medical is positioned for future growth. Despite facing challenges from the expiration of the 75/25 blended rate and Humana’s new arrangements, Quipt’s cost optimization efforts have led to a sequential improvement in adjusted EBITDA margins, which rose by 100 basis points to 22.8%. This improvement is a positive indicator that suggests the company is effectively managing its financial structure to offset revenue pressures.
Additionally, Quipt’s management expects to overcome the headwinds from terminated contracts and anticipates returning to its target of 8-10% annual organic growth. The stabilization of its business with Humana and the potential for margin improvement further support the Buy rating. Although Quipt’s current trading multiples are lower compared to peers like AdaptHealth, this presents a potential value opportunity as the company shows signs of steady growth and financial recovery.
In another report released on February 12, Stifel Nicolaus also maintained a Buy rating on the stock with a C$6.70 price target.
Based on the recent corporate insider activity of 10 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of QIPT in relation to earlier this year.