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Stock Commentary: Medilines Distributors teases “record” revenues and profits

Merkado Barkada

February 18, 2022 | 8: 02am

The teaser for MEDIC’s annual file pumped the company’s file full-300 and sixty five days revenues (P1.6 billion; 10% development) and profit (over 50% development), and tried to contrivance as grand attention as doable to how Medilines Distributors’ [MEDIC 1.14 8.57%] achievement of these milestones had small (if something else) to construct with COVID-19.

MEDIC ties its revenue development to its shipping of five most cancers treatment machines to hospitals around the country, and ties its profit development to its “strategic shift” in merchandise supplied with the introduction of its scientific consumables industry, which it describes as a “snappily-transferring, excessive-margin” section. MEDIC is focusing on “over P300 million” in consumables gross sales for 2022.


The click release became doing its very finest to distance MEDIC’s industry from the pandemic.

They specifically mention that MEDIC had a “yearly be aware file of gross sales and profit development even ahead of the pandemic”, tie the file revenue development to its shipping of “world-class Cancer Remedy equipment”, and indicate as heavily as doable that MEDIC’s gigantic 2021 results are no longer correct some fluke precipitated by the once-in-a-lifetime successfully being crisis.

MEDIC is clearly doing a small PR to adjust investor perceptions of its industry to 1 who’s tied to the country’s persevered development and prosperity, and no longer to the quiz that became created by an endemic that’s starting up to reduce in intensity. It’s a animated transfer.

Declare what you will most certainly be capable to about MEDIC, but it absolutely has very estimable positioning in a excessive-margin alternate that’s at chance of grow a wonderful deal over the arrival decades.

The IPO could also need been overpriced, but doesn’t primarily dispute to the deserves of the underlying industry. If MEDIC can proceed this race into Q1 and Q2 of this 300 and sixty five days, I deem of us will launch to buy scrutinize.

This isn’t an endorsement of MEDIC or a prediction that it is a long way going to outperform other stocks this 300 and sixty five days or over the very long time interval; I’m correct making an try to wrap my head around what MEDIC in truth is now, and what it may per chance perchance even be in a roundabout plan, given that satisfactory time has handed from that stinker of an IPO and the stock trace has settled into something of a exact pattern.

I’m going to be looking at MEDIC’s segmented reporting of its fresh consumable industry very carefully to stare if it is heading within the correct course with its 2022 projections.

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