LiDCO (LID) : Corp

Increased sales in China due to COVID-19

Key data

  • Share price (p) 5.3
  • Target price (p) 11.0
  • Market cap (£m) 12.8
  • Enterprise value (£m) 11.4

LiDCO’s Chinese distribution partner, Beijing Gloryway Medical Company, has sold a small number of haemodynamic monitors in Wuhan, China, as a direct response to the COVID-19 outbreak. Haemodynamic monitoring for patients in intensive care is clinically beneficial, and neither LiDCO nor its distributor’s staff were required to visit Wuhan. LiDCO is prepared should there be a significant increase in demand. No changes to forecasts and we reiterate our target price of 11p.

Mark Brewer 020 7220 0556

Resisting the virus and returning the cash

Key data

  • Share price (p) 115.6
  • Target price (p) 210.0
  • Market cap (£m) 153.4
  • Enterprise value (£m) 116.6

On Friday afternoon the company reiterated its FY 2019 guidance given in the January trading update. Moreover, management reassured investors that it was seeing minimal impact from the Coronavirus outbreak in FY 2020 and remains in line with previous guidance for this year. The main Chinese contract manufacturer resumed production in mid-February with little disruption; Telit is working with partners to avoid supply chain problems and monitoring the situation closely. Its Italian offices are in an affected region but operations should continue and it has multiple other sites. Reassuringly, Telit had over $48m cash at the December YE and it is the Board’s intention to return cash to shareholders by way of a share repurchase; up to 10% of the outstanding shares or up to $20m. We make no changes to forecast or target price.

Lorne Daniel 020 7220 0545

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