TSX:DHT.UN - Post by User
Comment by
HermannHalleron Feb 04, 2024 5:29pm
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Post# 35862113
RE:roundup
RE:roundupFrom Scotia:
DRI Healthcare Trust DHT.U-T: US$10.24 Target: US$24.00 Old: US$22.00 Rating: Sector Outperform
Out-year Revenue Runway Enhanced; Lifting Target to $24
OUR TAKE: Positive. Lifting the cap and expanding royalty interest in sales of pipeline drug, Omidria, is very favorable to our model and significantly mitigates royalty growth concerns beyond 2026 that the trust had been facing. Model adjustments result in new 3- and 8- year royalty revenue CAGR estimates to 19.6% and 7.4% (from 13.1% and 4.7%), respectively, the latter of which is consistent with newly updated guidance. Follow-up with management confirms that about $255M remains earmarked for deployment into 2025 in efforts to expand the royalty pipeline even further. Pending FY23 results later this month, our model adjustments result in a new unit price target of $24 (from $22), which we believe captures the underappreciated value of future cash flows.