Carl Zeiss Meditec (AFX GR) Germany
Healthcare
The share price tanks as management warns FY24 EBIT will be 31% lower than forecast. Alumbra had previously raised concerns that expectations were overly optimistic considering the likely non-recurring prior year benefits from: 1) normalising excess equipment order backlog and 2) low quality sources of EBIT such as higher capitalised R&D, lower inventory impairment charges and lower bad debt expense. In addition, Alumbra highlighted that an increase in related party receivables relative to APAC revenues in Q423 could be indicative of higher channel fill in China and that intensifying competition with STAAR Surgical could also weigh on revenue / margin growth. AFX has fallen 32% since Alumbra turned bearish in Jan 24.
Edition: 189
- 28 June, 2024