First Berlin Equity Research has published a research update on MPH Health Care AG (ISIN: DE000A289V03). Analyst Ellis Acklin reiterated his BUY rating and increased the price target from EUR 37.00 to EUR 40.00.

Abstract
Six month reporting gave investors the clearest look yet at the earnings power of the streamlined M1 Kliniken group. Beauty sales rose 11% YoY to €56.9m, while EBIT climbed 24% to €18.6m. The margin widened 3.3 pp to 32.7%, which sits comfortably above M1’s ~20% target. Adjusted for the €-4.1m non-cash deconsolidation effect from the Haemato disposal, group EBIT reached €19.7m, up 9.5% YoY despite the sharply smaller revenue base. MPH’s H1 NAV edged ~2% higher to €248m for the January to June period. M1 shares caught a bid this summer and are now testing all-time highs, which should unlock further NAV upside for MPH in H2. Our MPH TP increases to €40 (old: €37) on the back of an overhauled M1 DCF model that now reflects the improved trajectory of the standalone beauty business. We remain Buy-rated on MPH (53% upside).