Raymond James Pointing to its “aggressive yet prudent” approach to M&A and “full deal pipeline,” Raymond James analyst Rahul Sarugaser expects Skylight Health Group Inc. to “materially boost its top line during the next few quarters.”
In a research report released Wednesday, he initiated coverage of the Toronto-based services and technology company, which focus on U.S. multi-specialty primary healthcare networks, with an “outperform” rating and $2.25 target, exceeding the $2.12 average.
“According to our revenue estimates, SHG trades at 5.5 times and 4.6 times 2022 and 2023 EV/Revenue, respectively, representing a 10-26-per-cent discount to peers,” said Mr. Sarugaser. “As such, we derive an average EV/Revenue valuation of $2.23 per share, which we round, and derive a Target Price of $2.25 per share. Given that this represents a 25-per-cent premium to SHG’s current share price at the time of writing, we ascribe an Outperform rating.”