Medistim (OB:MEDI) posted headline numbers that reinforce its growth trajectory, with revenue forecast to climb 7.5% per year, handily outpacing the wider Norwegian market’s expected 2.3% growth rate. Over the past five years, earnings have grown by an average of 10% annually, culminating in a notable 25.7% growth just in the most recent year. Net profit margins have increased to 20.9% from 19.6% the year before. The steady expansion in both margins and profit quality sets a strong backdrop, but recent share price volatility means investors may be weighing these gains against valuation concerns and short-term uncertainty.
See our full analysis for Medistim.
With those results on the table, let’s see how they measure up against the most talked-about narratives in the market. Some may get confirmed, while others could face new scrutiny.
See what the community is saying about Medistim
-
Between 66% and 73% of Medistim’s quarterly sales now come from probes and consumables. This underscores the significance of recurring revenue streams for the company’s financial resilience.
-
According to analysts’ consensus, this high proportion of repeat business supports stable, predictable income and underpins long-term profit growth.
-
A large recurring revenue base reduces exposure to swings in new equipment demand and helps limit earnings volatility even if procedure volumes fluctuate.
-
The consensus narrative notes this dynamic helps offset industry headwinds, such as a gradual shift toward less invasive procedures, which could affect growth in one-off product sales.
-
-
Medistim’s net profit margin improved to 20.9%, up from 19.6% last year. This trend is supported by an increased presence in high-margin direct sales markets like the US and Canada.
-
Analysts’ consensus indicates that the expansion of direct sales channels and the launch of higher-value MiraQ platforms with INTUI software are driving this margin growth.
-
The consensus narrative also points to recurring price increases planned in the US, which are expected to bolster average selling prices and help sustain elevated margins.
-
It is noteworthy that these margin gains are partly attributed to mix shift and catch-up effects following the pandemic, which may not continue at the same rate during slower growth periods.
-
-
Despite a current share price of NOK 260.0, Medistim trades well above its DCF fair value of NOK 196.21. Its price-to-earnings ratio of 36.2x appears attractive versus peers but sits at a premium to the broader European Medical Equipment industry average of 29.6x.
-
Analysts’ consensus takes a cautious stance, highlighting that even as business momentum appears healthy, the share price outpaces both fair value and the consensus analyst target.
-
The consensus narrative highlights this disconnect, noting that the current share price exceeds the analyst average target, which suggests the market may be factoring in optimistic growth or margin assumptions.
-
Consensus also flags that unless Medistim can maintain its above-market growth rate and ongoing margin improvements, today’s valuation could appear high compared to both sector peers and intrinsic value.
-