Last week the Ramsay Health Care Limited (ASX: RHC) share price had one of its best weeks in months as investors returned to the private hospital operator following the government's plan to put an end to declining private health insurance participation rates.
Things haven't started quite as positively this week, though.
In late afternoon trade Ramsay's shares are down almost 1% to $65.33 despite the market climbing higher today.
Why have its shares missed out on today's move higher?
This morning Credit Suisse released a research note which downplayed any positive impact from the government's private health insurance reforms.
While the broker acknowledges that the benefits will not be known for years, it isn't holding its breath.
Its analysts appear to believe that affordability issues will not be solved through this latest initiative and the decline in participation rates will continue.
In light of this, the investment bank has retained its neutral rating and $71.60 price target on Ramsay's shares.
Should you invest?
While I do agree with Credit Suisse on the impact, or lack thereof, of the government's plans on the industry, I don't agree with the rating.
I think that Ramsay is great value at the current share price and would class it as a buy ahead of industry rivals Healthscope Ltd (ASX: HSO) and Primary Health Care Limited (ASX: PRY).
While declines in private health insurance participation rates are a concern, I believe the company is more than capable of growing its earnings at an above-average rate over the next few years regardless of this.
This is thanks to the tailwinds of Australia's ageing population and its ability to fuel growth through acquisitions and expansions.
