Diagnostyka: testing positive (downgraded to HOLD)
We have downgraded Diagnostyka to HOLD (from Buy), with our 12M price target (PT) upped to PLN 203/share (from PLN 159/share), on valuation grounds. In 1H25, the company surprised us positively, with strong volume dynamics (up 8% yoy), despite Profilaktyka 40+ finally coming to an end, and proving the low elasticity of demand, on 9% yoy price hikes. Effectively, while increasing our 2025-27E sales forecasts for Diagnostyka by 6-7%, we have upped our EBITDA estimates by 9-11%. Currently, we expect 2024-27E EBITDA and CAGRs of 17% and 19%, respectively. All that said, we recognise that the stock has more than doubled since its IPO in February, and is trading currently at a 2025E EV/EBITDA of 12x, broadly in line with the CEE Healthcare names, but at a 20% premium to its global diagnostics peers’ median.
WOOD & Company is the leading investment bank in Emerging Europe. Founded in 1991 and head-quartered in Prague, our footprint spans the region and touches investors around the globe.
A pioneer in Emerging Europe, WOOD executed many of the first CEE equity trades and landmark investment banking transactions. Our electronic trading platform was the first in the region, and remains the best. We are continually expanding our relevance and reach in these ever-evolving markets.
Our equity market share reflects our stature: 7% in Warsaw, 20% in Bucharest, 16% in Hungary, 40% in Prague and 5% in Vienna. Our distribution is unparalleled, with the largest salesforce in the region, servicing a uniquely diverse investor base.
We couple local expertise with a truly international perspective. With offices on the ground in the region, and in key financial hubs such as London and Milano, we are never far from our clients and we remain at the forefront of what’s afoot in the CEE emerging and frontier landscape.
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