HCL Gets Buy Recommendation
Daniel Stewart and Fincap have both recently released data and both are recommending Healthcare Locums as a Buy
Daniel Stewart said, Healthcare Locums is delivering excellent
growth in a buoyant and growing market. Our previous profit expectations look like being exceeded, with strong underlying organic growth boosted by the weakness of sterling and the recent cuts in interest rates. As a result we are lifting our forecasts by 18% for 2009 and 8% for 2010. These projections, which we consider conservative, would see the company trebling its EPS in three years. Although the shares have performed well relative to the bear market, their absolute rating fails to reflect the companys achievements or its potential. We have raised our target price from 210p to 225p.
Fincap added, HCL continues to see strong underlying growth, with a pledge of no more acquisitions growth going forward will all be organic. Equally investors will see the group become cash generative with significant increases in the dividend and no requirement for share placings. HCL operates in non-cyclical markets, where growth is not constrained by demand. With a premium growth rate and defensive qualities the shares look good value compared to the peer group and we initiate our coverage with a Buy rating.