Is the stock price surge of Pro Medicus justified
Imaging business Pro Medicus (ASX: PME) has certainly benefited from market momentum with a stellar rise in its stock price. In fact, its share price surged just over 12 per cent last week after it scored a $140 million 10-year contract with the US healthcare business Baylor Scott & White Health.
There is plenty to like about the business
“Due to low capital requirements and high profit margins, Pro Medicus enjoys high returns on invested capital,” Morningstar analyst Shane Ponraj says.
“It also stands to benefit from industry tailwinds including larger datasets, cloud adoption and remote access that will likely accelerate the need for hospitals to switch to a faster and more scalable solution.”
Despite these positives, Ponraj…
