RE:VMD at 4x adj. EBITDA versus indebted APR at 7x adj. EBITDATropicalsun, VMD should now be above US$10 given that VMD has much stronger revenue YoY growth for its core business (exclude COVID-19 revenue) and a much healthier balance sheet than acquired APR.
stockfy wrote:
VMD's main competitors are Lincare (owned by Linde AG) and Apria Healthcare (APR).
APR's top line YoY growth in 2021 was only 4%.
For comparison, VMD's top line YoY growth for its core business in 2021 is 11%.
Indebted APR was acquired a couple of months ago for a total transaction value of $1.6 billion including its debt:
https://www.pymnts.com/acquisitions/2022/healthcare-firm-owens-minor-buys-apria-for-1-6b/
https://www.homecaremag.com/news/owens-minor-acquire-apria
According to APR's guidance, adj. EBITDA in 2021 is about $230 million.
Therefore, indebted APR with only 4% YoY growth was acquired for 7 times its adj. EBITDA.
For comparison, VMD has a net cash position of $24 million, announces 11% YoY growth and its Enterprise Value at $4 per share is only 4 times its adj. EBITDA.
To sum it up, VMD is dirt-cheap and a takeover target.