At time of writing, the share price of Alcidion Group Limited [ASX:ALC] is up 12.2%, trading at 23 cents.
The Alcidion share price has undergone a remarkable rise over the last 12 months, with a return of 360%:
Today, the company announced a new partnership with Healthscope, a leading private healthcare provider.
We look at the Alcidion share price, the company’s financials and prospects going forward. We conclude that while pullbacks may occur given its remarkable rise, its future looks bright.
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Alcidion share price rises on Healthscope agreement, company on track to first profit
With the announcement released before the ASX opened today, the Alicidion share price spiked and didn’t fall below 20.5 cents for the rest of the day.
The agreement with Healthscope is for three years, ‘to implement a solution to support its data and analytics strategy,’ and will net the company $895k in revenue.
With data science playing an increasing role in healthcare, Alcidion shareholders will be hoping for more deals like the one announced today.
For reference, here’s a quick look at their financials as per their most recent results release:
- Revenue of $16.9 million, up 33% on last year
- Net loss of $84k
- Cash and cash equivalents of $3.2 million
Given they have, ‘contracted revenue of $11.7M to be recognised in FY2020 and a further $19.5M to be recognised over the following five years to 2025,’ they should be poised to be profitable this financial year if they continue to win contracts and grow revenue as they have previously.
As for a capital raise, this would appear unlikely in the immediate future given their current growth and cash.
If Alcidion wants to make another acquisition though, this could change.
Alcidion in right industry, looking for further growth
Overall, with the big trend of data in healthcare, Alcidion is well placed in the right industry as hospitals look for added efficiency.
With a whopping return so far this year, you could expect some shareholders to offload some shares to take profit eventually.
But for now, Alcidion’s future looks bright. Market penetration in Europe, via the UK, as well as the lucrative US healthcare market shapes as the next major challenge for the company.
For Money Morning