Look out below!
At midday today shares of Primary Health Care Limited (ASX: PRY) were down a meaty 5.8% following the release of its half-year results earlier this morning.
In the six months to 31 December 2014, the company achieved robust revenue growth of 6.3% compared to the prior half, whilst its interim dividend was held flat at nine cents per share.
Earnings per share jumped slightly higher to 10.5 cents, whilst earnings before interest, taxes, depreciation and amortization, or EBITDA, climbed 2.1% to $196.1 million.
Commenting on the results, the company's acting Managing Director, Andrew Duff, said: "Our scale, infrastructure and expertise increasingly means Primary is the partner of choice for medical professionals looking to provide their patients with affordable and accessible care."
He reaffirmed the group's FY15 outlook of EBITDA in the range of $410 million to $425 million and earnings per share growth of between 5% and 12% – based on FY14 restated earnings of 22.7 cents.
Mr Duff added, "In an industry with strong growth fundamentals linked to ageing demographics, we see increasing demand for our services, and believe we are well-placed to deliver steady growth in earnings per share and dividends per share over the medium to long-term."
In a separate announcement, the company said Mr Peter Gregg has been appointed as Managing Director and CEO. He will commence with the company on 2 March 2015. Mr Gregg was deputy CEO and CFO of Leighton Holdings Limited (ASX: LEI) between 2009 and 2014.
Should you sell Primary Health Care?
Despite the market's reaction to today's release, the results weren't terrible, but they weren't terrific either. However with shares priced at just 14 times earnings and trading on a dividend yield equivalent to 3.8%, the market may have slightly overreacted.
Whilst I'm not rushing out to buy Primary Health Care shares today there is one stock I recently bought for my family's portfolio which is still an excellent buy. It offers growth at a reasonable price and a juicy fully franked dividend – which it increased today!
