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The analysts told investors in a note that their hospital capex survey is positive for GEHC, and they see the company as well positioned to capitalize on the Alzheimer’s opportunity.
“Hospital spending in 2024 is expected to be up by 1.5% compared to 2023. Over half of the respondents see their capital budgets up in 2024 over 2023,” the analysts wrote. “GEHC’s share of hospital’s imaging (~35%) & ultrasound equipment (~44%) budget relatively stable, and Cardiovascular Ultrasound and MR were the highest priority areas for capital spending over the next 12 months.”
On the Alzheimer’s opportunity, the firm stated that their market model suggests ~$500 million of incremental sales by 2027. In addition, they estimate ~$47M of incremental revenues in 2024.
“We also see valuation as attractive vs. peers,” wrote the analysts. “We view our multiple as appropriate and believe that there is room for upward multiple revision as GEHC makes progress on delivering towards its medium-term targets.”
