Sector spotlight: healthcare equipment

The healthcare equipment sector has massive potential; let’s take a look.

Article updated: 26 June 2020 11:00am Author: Michael Baxter

I am of the view that health care equipment, especially when it employs health tech, is going to see rapid growth over the next few years and it is an area where the UK has expertise.

I am especially keen to find companies that are applying data, AI, telemedicine, genomics, or indeed cutting-edge technology.

So, let’s see if there are any interesting companies. This piece is designed to give you a taste. If any companies here pique your interest, I recommend considerable research before you take the plunge.

Advanced Medical Solutions (AMS)

The company is in the wound care business which has been hit by the Covid-crisis, after-all lockdowns have presumably led to less injuries. Advanced Medical Solutions applies technology in the areas of creating fibres and foam dressings, and other technologies. I recommended a look at its own website looking at its technologies. 

Period Share price (approx)
Share price 242p
This year high 307p
This year low 218p
12 month high 320p
5-year high 368p (2018)
All time high 368p
Long term performance Up seven-fold since IPO in 1998 & five-fold since 2010
Market cap £517m
P/E 27
Dividend yield 0.64%
Balance sheet Current assets/liabilities approx three to one  

Advanced Oncotherapy

Advanced Oncotherapy is a provider of the next generation of proton beam therapy systems. However, the steady decline in its share price is worrying, but before you dismiss it, consider its technology. Does proton beam therapy have massive potential? Was it subject to teething problems? Or is it an example of overhyped technology that is proving disappointing? This article may be useful: Proton beam therapy is arriving in the UK: what does that mean for patients? 

Sometimes a company can be ahead of its time, but if it can survive and develop its technology it can thrive when the technology comes into its own. The company raised funds last year.

It's certainly worth more research.

Period Share price (approx)
Share price 24.8p
This year high 40p
This year low 21p
12 month high 45p
5-year high 219p (2015)
Market cap £77m
P/E -1.78
Dividend yield 1.75% 
Balance sheet Intangible assets worth £40m. Net assets £34m  

Bioventix

Bioventix manufactures and supplies high affinity sheep monoclonal antibodies for use in diagnostic applications, such as clinical blood testing. It's shares recently hit an all time high, and it has a very impressive balance sheet. The company builds on technology discovered in 1974. It is an exciting company, with fascinating technology. Worth more research.

Period Share price (approx)
Share price 4,220p
This year high 4,500p
This year low 2,635p
5-year high 4,500p
Market cap £217m
P/E 36
Dividend yield 1.75%
Balance sheet Current assets worth 14 times total liabilities  

Collagen Solutions

Collagen Solutions specialises in producing custom formulations of medical-grade collagen biomaterials and tissues for use in medical devices –– or turns animal tissues into products used for surgery or medical treatments. Recent update revealed a bulging order book, suggesting revenue growth may be set to continue. However it is yet to make a profit.

Period Share price (approx)
Share price 3.22p
This year high 3.4p
This year low 0.95p
12 month high 4.15p
5-year high 9.32p (2015)
All time high 15.12p (2014)
Market cap £14 million
P/E -6
Market cap £14 million
Balance sheet Net assets: £15m,
Other interesting data Revenue had increased four-fold since 2015  

Creo Medical Group

Creo Medical Group shares have increased three-fold since IPO three and a half years ago. It says that it transforms “procedures that blur the lines between surgery and endoscopy.” The companies Chief Technology Officer was recently shortlisted for the Institution of Engineering and Technology’s A F Harvey Engineering Research Prize.

Period Share price (approx)
Share price 218p
This year high 229p
This year low 100p
12 month high 229p
5-year high 237p (January 2019)
Market cap £348m 
P/E Minus 17  
Balance sheet Net assets £82m, total assets 16 times total liabilities  

Convatec Group

Convatec Group is a global medical products and technologies company focused on therapies for the management of chronic conditions, with leading market positions in advanced wound care, ostomy care, continence and critical care, and infusion devices.

Period Share price (approx)
Share price 209p
This year high 220p
This year low 147p
12 month-high 220p
5-year high 342p (2016)
All time high 342p (IPO 2016)
Market cap £6.9m
P/E -1.4
Dividend yield 14.00p
Balance sheet Total equity £2.23m   

CareTech

This company Provides high quality care and support across the whole social care spectrum for children and adults below retirement age. Recently CareTech said it was on track to meet targets for this year. Given this, the fall in the share price related to Covid is interesting and may not be entirely logical.

Period Share price (approx)
Share price 420p
This year high 502p
This year low 308p
12 month-high 502p
5-year high 502p
Market cap £468m
P/E 22
Dividend yield 2.8%
Balance sheet Total equity £335m

CVS Group

CVS Group is the largest integrated veterinary services provider in the UK.

Period Share price (approx)
Share price 971p
This year high 1,250p
This year low 706p
12 month high 1,250p
5-year high 1,470p (2017)
Market cap £686m 
P/E 83
Dividend yield 0.57% 
Balance sheet Total equity £163m 
Other data Revenue trebled three- fold over the last five years  

Eden Research

Eden Research are innovators of sustainable crop protection solutions. Could be interesting for ethical investors, It recently raised £10 million for a new insecticide.

Period Share price (approx)
Share price 8.02p
This year high 9.83p
This year low 4.65p
12 month-high 11.48p
5-year high 23p (2015)
All time high 23p
Market cap £30m 
P/E -14.61
Balance sheet Assets six times greater than liabilities  

EFK Diagnostics

Global medical manufacturer. EFK Diagnostics shares recently hit all-time-high. It has won a contract for the manufacture and supply of a device which allows Covid-19 samples to be rapidly inactivated in the collection tube.

Period Share price (approx)
Share price 46.5p
This year high 51p
This year low 17p
12 month high 51p
5-year high 51p
Market cap £205m 
P/E 55
Dividend yield 2.22p
Balance sheet Net assets £71m   

Georgia Healthcare Group

Georgia Healthcare Group provide Integrated healthcare services, pharmacy and medical insurance in Georgia.

Period Share price (approx)
Share price 92p
This year high 128p
This year low 67p
12 month high 252p
5-year high 394p (2017)
All time high 394p
Market cap £120m 
P/E 6.86
Dividend yield 1.64% 
Balance sheet Net assets £160m   

Hutchinson China Meditech

A biopharmaceutical company aiming to become a global leader in the discovery, development and commercialisation of targeted therapies and immunotherapies in oncology and autoimmune diseases. Hutchinson China Meditech shares have increased 17-fold since 2006 IPO. US Food and Drug Administration recently granted the company ‘fast track designation’ of a treatment of patients with metastatic colorectal cancer.

Period Share price (approx)
Share price 385p
This year high 452p
This year low 258p
12 month-high 457p
5-year high 560p (2017)
All time high 560p (IPO 2006)
Market cap £2.7bn 
P/E -32
Balance sheet £312m, assets three times liabilities  

Immunodiagnostic Systems

A leading in-vitro diagnostic solution provider to the clinical laboratory market. Immunodiagnostic Systems has developed a Covid-19 antibody test, hence recent surge in share price.

Period Share price (approx)
Share price 270p
This year high 305p (early June)
This year low 170p
12 month-high 305p
5-year high 345p (2017)
All time high 1,200p (2014)
Market cap £82m 
P/E 24
Dividend yield 0.68% 
Balance sheet Total equity £57m, assets worth more than four times liabilities  

Instem

Supplier of IT applications to the early development healthcare market delivering compelling solutions for data collection. Instem is very much into technology of the moment, and indeed probably future.

Period Share price (approx)
Share price 452p
This year high 530p (early June)
This year low 375p
12 month-high 530P
5-year high 530p
Market cap £77m 
P/E -80
Balance sheet Total equity £16.8m, assets approaching twice value of liabilities  

Kromek

Kromek produces gamma and neutron radiation detectors and gamma radiation spectrometers. They recently won a Defence Advanced Research Projects Agency (DARPA) – an agency of the US Department of Defence

Period Share price (approx)
Share price 18.84p
This year high 25p
This year low 10p
12 month-high 27p
5-year high 44p (2015)
All time high 78p (2014)
Market cap £66m 
P/E -192 
Balance sheet Total equity £51m, total assets roughly five times total liabilities  

Mediclinic International

Mediclinic International is a Middle Eastern and South Africa-focused operator of private hospitals. They formed in February 2016 from the merger of Al Noor Hospitals and Mediclinic International and considering how Covid has hit non-Covid related hospital visits this year, it is perhaps not surprising the share price has fallen.

Period Share price (approx)
Share price 275p
This year high 412p
This year low 245p
12 month-high 413p
5-year high 1,179p (2015)
Market cap £2bn
P/E -6.25
Dividend yield 2.95% 
Balance sheet Total equity £3m, total assets approaching double total liabilities  

Medica Group

Medica Group are an independent provider of radiology reporting, delivering in excess of 1.5 million reports a year. Making heavy use of AI.

Period Share price (approx)
Share price 126p
This year high 160p
This year low 100p
12 month-high 160p
5-year high 235p (2018)
All time high 235p (2018) (IPO 2017)
Market cap £140m 
P/E 17.5
Dividend yield 1.8%   

Oncimmune Holdings

Oncimmune Holdings specialises in the detection of cancer and its treatment by harnessing the sophisticated disease detecting capabilities of the immune system to find cancer in its early stages. Recent deal signed with Roche has lifted its share price.

Period Share price (approx)
Share price 137p
This year high 137p
This year low 37p
12 month-high 137p
5-year high 146p (2018)
All time high 146p (2018) (IPO 2016)
Market cap £87m
P/E 10.5
Balance sheet Net assets £7.87m, total assets around five times total liabilities  

Smith & Nephew

The giant of the sector and shares only recent hit an all-time high. Smith & Nephew is a global orthopedics company. It develops, manufactures, markets and sells medical devices in the sectors of advanced medical devices and advanced wound management. Interesting new products.

Period Share price (approx)
Share price 1,657p
This year high 1,979p
This year low 1,152p
12 month-high 1,979p
5-year high 1,979p
All time high 1,979p 
Market cap £14bn 
P/E 31
Dividend yield 1.85% 
Balance sheet Total equity £5bn, assets more than double liabilities  

Tristel

Tristel shares have increased 10-fold since 2005 IPO. It is the manufacturer of infection control, contamination control and hygiene products. A recent report predicted what it called astonishing growth in the Sterile Surface Disinfectant Market over the next five years.

Period Share price (approx)
Share price 463p
This year high 525p (April)
This year low 302p
12 month-high 525p
5-year high 525p
Market cap £208m 
P/E 50.33
Dividend yield 1.2%
Balance sheet Net assets £23m, total assets approach six times total liabilities  

UDG Healthcare

Shares have increased 10-fold since 1998. UDG Healthcare is in the healthcare advisory, communications, commercial, clinical and packaging services. It operates around the world.

Period Share price (approx)
Share price 721p
This year high 832p
This year low 464p
12 month-high 832p
5-year high 949p (2017)
Market cap £1.8bn
P/E 38
Dividend yield 1.8% 
Balance sheet Net assets £900m, total assets more than double total liabilities  

Yourgene Health

Yourgene Health shares have trebled since 2002 IPO. It develops simple and accurate prenatal diagnostic products. It has been working with partners on Covid-19 testing kits

Period Share price (approx)
Share price 18p
This year high 21p (April)
This year low 7.75p
12 month-high 21p
5-year high 25p (2015)
Market cap £109m 
P/E 17.5
Balance sheet Net assets £10.7m   

These views are those of the author alone and do not necessarily reflect the view of The Share Centre, its officers and employees

Michael Baxter portrait photo
Michael Baxter

Economics Commentator

Michael is an economics, investment and technology writer, known for his entertaining style. He has previously been a full-time investor, founder of a technology company which was floated on the NASDAQ, and a director of a PR company specialising in IT.

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