The Pro Medicus Limited (ASX: PME) share price closed 49 cents or 4.6% higher today at $11.20 despite the benchmark S&P/ ASX 200 (ASX: XJO) index finishing down 0.7% for the day and down around 2.3% for the week.
This index-trashing form is not for nothing either, as Pro Medicus has released a couple of positive announcements to investors over the last 5 weeks.
First of all on November 20 the software-as-a-service medical imaging company announced it has signed a contract worth $27 million over 7 years to provide its software to Partners Healthcare in the US, which is the operator of several major hospitals in the state of Massachusetts.
This was Pro Medicus's biggest deal to date and further validates the bulls' thesis that Pro Medicus has a market-leading software product that could deliver strong profit growth over the long term.
Furthermore on December 10 Pro Medicus announced that it has signed a contract extension with a German government hospital network to use its flagship Visage 7 software technology.
The contact apparently includes an upfront license fee worth $3 million to Pro Medicus alone. So far most of Pro Medicus's sales have been in the lucrative US healthcare market, but Europe is a potentially another attractive market for the group.
Unfortunately, Pro Medicus's potential is no secret anymore with the group having a market valuation of $1.1 billion, despite posting a profit of just $12.7 million in FY 2019.
In fairness though it's the future that counts with Pro Medicus having some $135 million in forward revenue over 5 years as at June 30 2018 before its latest contract wins. It also has a lot of operating leverage as a software-as-a-service business and a share price that is up more than 1,100% over the past 5 years.
