LSE:MDC

Stock Analysis Report

Mediclinic International

Executive Summary

Mediclinic International plc, together with its subsidiaries, operates private hospitals.

Rewards

Trading at 54.6% below its fair value

Earnings are forecast to grow 12.27% per year

Became profitable this year

Risk Analysis

Has a high level of debt

Unstable dividend track record

Highly volatile share price over past 3 months

Large one-off items impacting financial results



Snowflake Analysis

Good value with adequate balance sheet.


Similar Companies

Share Price & News

How has Mediclinic International's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: MDC's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-6.2%

MDC

-0.3%

GB Healthcare

10.0%

GB Market


1 Year Return

-19.1%

MDC

-32.6%

GB Healthcare

-23.0%

GB Market

Return vs Industry: MDC exceeded the UK Healthcare industry which returned -27.8% over the past year.

Return vs Market: MDC exceeded the UK Market which returned -22.7% over the past year.


Shareholder returns

MDCIndustryMarket
7 Day-6.2%-0.3%10.0%
30 Day-25.0%-17.8%-17.6%
90 Day-38.2%-36.3%-27.3%
1 Year-17.2%-19.1%-31.5%-32.6%-18.9%-23.0%
3 Year-62.3%-64.2%-46.7%-49.0%-12.9%-24.2%
5 Yearn/a-12.2%-16.8%1.6%-21.8%

Price Volatility Vs. Market

How volatile is Mediclinic International's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Mediclinic International undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: MDC (£2.54) is trading below our estimate of fair value (£5.6)

Significantly Below Fair Value: MDC is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: MDC is good value based on its PE Ratio (14.9x) compared to the Healthcare industry average (17.4x).

PE vs Market: MDC is poor value based on its PE Ratio (14.9x) compared to the UK market (12.5x).


Price to Earnings Growth Ratio

PEG Ratio: MDC is poor value based on its PEG Ratio (1.2x)


Price to Book Ratio

PB vs Industry: MDC is good value based on its PB Ratio (0.6x) compared to the GB Healthcare industry average (1.2x).


Next Steps

Future Growth

How is Mediclinic International forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

12.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: MDC's forecast earnings growth (12.3% per year) is above the savings rate (0.5%).

Earnings vs Market: MDC's earnings (12.3% per year) are forecast to grow slower than the UK market (15.4% per year).

High Growth Earnings: MDC's earnings are forecast to grow, but not significantly.

Revenue vs Market: MDC's revenue (3.5% per year) is forecast to grow faster than the UK market (2.6% per year).

High Growth Revenue: MDC's revenue (3.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: MDC's Return on Equity is forecast to be low in 3 years time (6.3%).


Next Steps

Past Performance

How has Mediclinic International performed over the past 5 years?

-50.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: MDC has a large one-off loss of £141.0M impacting its September 30 2019 financial results.

Growing Profit Margin: MDC became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: MDC's earnings have declined by -50.2% per year over the past 5 years.

Accelerating Growth: MDC has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: MDC has become profitable in the last year, making it difficult to compare its past year earnings growth to the Healthcare industry (19.8%).


Return on Equity

High ROE: MDC's Return on Equity (4.3%) is considered low.


Next Steps

Financial Health

How is Mediclinic International's financial position?


Financial Position Analysis

Short Term Liabilities: MDC's short term assets (£1.1B) exceed its short term liabilities (£586.0M).

Long Term Liabilities: MDC's short term assets (£1.1B) do not cover its long term liabilities (£3.3B).


Debt to Equity History and Analysis

Debt Level: MDC's debt to equity ratio (58.2%) is considered high.

Reducing Debt: MDC's debt to equity ratio has reduced from 98.9% to 58.2% over the past 5 years.

Debt Coverage: MDC's debt is well covered by operating cash flow (22.1%).

Interest Coverage: MDC's interest payments on its debt are well covered by EBIT (4.9x coverage).


Balance Sheet

Inventory Level: MDC has a high level of physical assets or inventory.

Debt Coverage by Assets: MDC's debt is not covered by short term assets (assets are 0.5x debt).


Next Steps

Dividend

What is Mediclinic International's current dividend yield, its reliability and sustainability?

3.11%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: MDC's dividend (3.11%) is higher than the bottom 25% of dividend payers in the UK market (2.7%).

High Dividend: MDC's dividend (3.11%) is low compared to the top 25% of dividend payers in the UK market (7.3%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, MDC has been paying a dividend for less than 10 years.

Growing Dividend: MDC has only been paying a dividend for 4 years, and since then payments have not increased.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (46.2%), MDC's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: MDC's dividends in 3 years are forecast to be well covered by earnings (28% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.7yrs

Average management tenure


CEO

Ronnie van der Merwe (56yo)

1.75s

Tenure

UK£689,400

Compensation

Dr. Carel Aron van der Merwe, also known as Ronnie, has been Chief Executive Officer and Executive Director of Mediclinic International plc since June 1, 2018 and served as its Chief Clinical Officer. Dr.  ...


CEO Compensation Analysis

Compensation vs Market: Ronnie's total compensation ($USD855.72K) is below average for companies of similar size in the UK market ($USD1.93M).

Compensation vs Earnings: Ronnie's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Carel van der Merwe
CEO & Executive Director1.75yrsUK£689.40k0.0070% £131.2k
Petrus Myburgh
Group CFO & Executive Director3.58yrsUK£527.00k0.011% £211.1k
Dirk Le Roux
Chief Information Officerno dataUK£2.40mno data
James Arnold
Head of Investor Relationsno datano datano data
Magnus Oetiker
Chief Human Resources & Corporate Development Officer0.75yrno datano data
Gert Hattingh
Chief Corporate Services Officer4.17yrsUK£4.32mno data
Biren Valodia
Chief Marketing Officer of Medi-Clinic Southern Africa no datano datano data
Clara Findlay
Chief Legal Officer of Mediclinic Southern Africano datano datano data
Wimpie Aucamp
Chief Operating Officer of Medi-Clinic for Southern Africano datano datano data
Greg Wyk
Chief Human Resources Officer of Mediclinic Southern Africano datano datano data

2.7yrs

Average Tenure

54yo

Average Age

Experienced Management: MDC's management team is considered experienced (2.7 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Carel van der Merwe
CEO & Executive Director1.75yrsUK£689.40k0.0070% £131.2k
Petrus Myburgh
Group CFO & Executive Director3.58yrsUK£527.00k0.011% £211.1k
J. Grieve
Senior Independent Director0.67yrUK£81.00k0.0010% £19.1k
Seamus Keating
Independent Non-Executive Director6.75yrsUK£90.00kno data
Daniel Meintjes
Non-Executive Director4yrsUK£748.00k0.019% £361.3k
Edwin de la Harpe Hertzog
Non-Executive Chairman4yrsUK£288.00k0.053% £1.0m
Jan Durand
Non-Executive Director4yrsUK£82.00kno data
Muhadditha Al-Hashimi
Independent Non-Executive Director2.33yrsUK£73.00kno data
Trevor Petersen
Independent Non-Executive Director4yrsUK£98.00kno data
Felicity A. Harvey
Independent Non-Executive Director2.42yrsUK£78.00kno data

3.8yrs

Average Tenure

59.5yo

Average Age

Experienced Board: MDC's board of directors are considered experienced (3.8 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Mediclinic International plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Mediclinic International plc
  • Ticker: MDC
  • Exchange: LSE
  • Founded: 1983
  • Industry: Health Care Facilities
  • Sector: Healthcare
  • Market Cap: UK£1.875b
  • Shares outstanding: 737.21m
  • Website: https://www.mediclinic.com

Number of Employees


Location

  • Mediclinic International plc
  • 25 Du Toit Street
  • Stellenbosch
  • Western Cape
  • 7600
  • South Africa

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
MDCLSE (London Stock Exchange)YesOrdinary SharesGBGBPFeb 2016
MO4DB (Deutsche Boerse AG)YesOrdinary SharesDEEURFeb 2016
MDCLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPFeb 2016
MEIJSE (The Johannesburg Securities Exchange)YesOrdinary SharesZAZARFeb 2016
MEPNMSE (Namibian Stock Exchange)YesOrdinary SharesNAZARFeb 2016
ANHG.YOTCPK (Pink Sheets LLC)ADRUSUSDApr 2016

Biography

Mediclinic International plc, together with its subsidiaries, operates private hospitals. The company offers acute care, specialist-orientated, and multidisciplinary healthcare services under the Mediclinic and Hirslanden brand names. It operates 18 hospitals, 2 day clinics, 3 outpatient clinics, and 112 theatres with approximately 1,916 inpatient beds in Switzerland; 49 hospitals, 8 day clinics, 5 sub-acute hospitals, and 296 theatres in South Africa, as well as 3 hospitals in Namibia with approximately 8,517 inpatient beds; and 7 hospitals, 2 day clinics, 18 outpatient clinics, and 37 theatres with approximately 926 inpatient beds in the United Arab Emirates. The company also provides treasury, hospital equipment, debt collection and related, emergency medical, management, food and catering, procurement, and healthcare management services; manages healthcare staff; and owns and manages properties. In addition, it engages in intellectual property holding and medical store/procurement businesses. Mediclinic International plc was founded in 1983 and is based in Stellenbosch, South Africa. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/30 23:00
End of Day Share Price2020/03/30 00:00
Earnings2019/09/30
Annual Earnings2019/03/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.