Wound care tech firm ConvaTec (CTEC) has impressed investors with its maiden results since floating on the stock market last Halloween.
Operating profit rises 8.1% from $437m to $472m in 2016.
FTSE 100 STOCK
Stockbroker Peel Hunt analyst Amy Walker is upbeat with a ‘buy’ recommendation, noting the business has beaten profit margin expectations.
In December, Shares introduced ConvaTec to our readers following its elevation into the FTSE 100 just seven weeks after floating.
The company makes medical products to help people live longer, including colostomy bags and catheters, and is a dominant supplier in the European Union and the US.
Before it floated, ConvaTec was owned by private equity, specifically Nordic Capital and Avista Capita which remain shareholders.
WHAT IS THE OUTLOOK?
Management is confident on the outlook for 2017 and expects organic revenue to grow faster than the 4% achieved in 2016. This confidence is underpinned by new products and an expanded geographical focus.
Morgan Stanley analyst Michael K Jungling comments: ‘Overall, we believe the results are operationally strong enough to keep the investment case of accelerating organic sales growth and margin expansion alive.’
Jungling expects earnings before interest and tax (EBIT) to rise from an expected $442m at the end of last year to $473m at the end of 2017.
