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HEAL,a -5% lower target price
Current, target price 1,155, 1,090 (-6%)
August 22nd, 2021
1 minute read
Sales declined
Costs low
1 minute read
Sales declined
- Sales declined by -5% in the second quarter to 1,513 billion rupiah which is our forecast 1,617 billion rupiah.
- This brings the average quarterly growth to 21%.
- We predict average growth of 3% in this next 12 months to bring sales to 1,685 billion rupiah in the second quarter 2022.
Costs low
- The cash cost ratio of net profit add non cash costs minus sales as a percent of sales was down to -71% in the second quarter & profit was 348 billion rupiah.
- Average quarterly costs are now at -73%.
- As cashflow costs are higher, we use -77% costs to predict a 293 billion rupiah profit in the second quarter of 2022.
Cashflow still negative
Balance sheet, higher leverage
Value, a -5% lower target price
- Cashflow was still negative -12 billion rupiah with investment spending of -220 billion rupiah in the second quarter.
- Average quarterly Cashflow is now at -21 billion rupiah.
- We use the same -220 billion rupiah investment spending which with higher sales gives a 158 billion rupiah cashflow in the second quarter 2022.
Balance sheet, higher leverage
- Cash declined from 597 to 573 billion rupiah in the second quarter.
- Liabilities increased from 3,154 to 3,271 billion rupiah so net cash worsened from -2,557 to -2,698 billion rupiah.
- With our forecast cashflow & a -113 billion rupiah equity payout, net cash will be -2,181 billion rupiah in 12 months time.
Value, a -5% lower target price
- HEAL capital from the last four years improved to -1,712 billion rupiah in the second quarter.
- At the current market value of 16,500 billion rupiah, based on our forecasts, it’s at 2.52X sales & 2.15X assets with a 0.7% yield.
- Our free cashflow forecast is 630 billion rupiah. At 25X (a 4% yield), this gives a -5% higher lower price of 1,103 rupiah.
