Should hit $4.50 ...analyst comments expect the valuation discount to close as the company scales,” he said.
On valuation, Rosenberg is using a 3.5x (previously 4.0x) multiple of his 2024 revenue estimate to generate a 12-month target price of $4.50 per share (unchanged), with the lowered multiple due to what he sees as a “tougher outlook” in the macro environment. At press time, Rosenberg’s $4.50 target reflected a projected return of 70 per cent.
“Shares trade at 1.8x 2024e revenue versus peers at 2.2x. Our comparables include Canadian tech consolidators and healthcare-focused technology names. We believe VHI’s traction in a leading sector, attractive financial profile and recurring revenue make it a compelling investment opportunity,” he said.