An analyst historically critical of Ryman Healthcare’s financial management has boosted its underlying earnings guidance and lifted its target share price by 4 per cent after a ‘strong’ full year result.
In a note sent to clients on Monday morning, Forsyth Barr senior equity analyst Aaron Ibbotson said he was
encouraged by the retirement village company’s “good cost control”, its shift towards building lower density villages and its progress in Australia.
“If RYM continues on this path and the New Zealand housing market does not substantially deteriorate from here, both of which we expect, we believe RYM will be one of the best mid/large cap equity stories in NZ over the coming 12 to 18 months,” his note read.
He kept an outperform rating on the stock, lifting his 12 month target price to $8.20, from $7.85, with expectations for underlying earnings to rise by 3 per cent this financial year, increasing to 5 per cent then 7 per cent in the following two years.
Ryman’s (RYM) share price was $6.06 before the market opened on Monday, up 12 per cent in the past week, although down 34.5 per cent in the past year.
