In today’s briefing:
- China Resources Medical – Hard to Earn High Profits Due to Poor Business Model and Policy Risk
- Reinventing American Healthcare
China Resources Medical – Hard to Earn High Profits Due to Poor Business Model and Policy Risk
- China Resources Medical has more advantages than ordinary private medical institutions in terms of its State-owned Key Enterprises background, delicacy management, cost reduction and efficiency increase, resources/talents, industrial chain layout.
- However, due to the policy environment, China Resources Medical just represents “a small area of relatively little risk in a large area that is clearly risky”.
- General hospitals have poor business model and profitability. Despite its strength, we are conservative about the outlook of China Resources Medical, which is difficult to achieve a higher valuation.
Reinventing American Healthcare
- One trend that has accelerated in the last few quarters is the pace of acquisitions being made by cash-rich companies.
- The significant Macroeconomic uncertainties that lie ahead, coupled with record cash balances at the largest firms on Wall Street, have only accelerated the pace of industry consolidation.
- It’s no secret that high-quality De-SPACs with strong earnings have been prime takeover/acquisition targets in recent months after seeing their shares take a beating through the year.
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