PUNT OF THE WEEK: Medical specialist EKF Diagnostics in good health as it signs US deal
EKF Diagnostics reported profits of £2.2m after £21.4m in revenue
What is it? EKF Diagnostics makes and sells products used for testing blood and tissue samples, known as in-vitro diagnostics.
What’s the latest? First-half results were out last week. It reported profits of £2.2million after £21.4million in revenue.
It has also recently struck a partnership deal with New York-based Mount Sinai Innovation Partners to share new technologies being developed for use in hospitals.
Who backs it? The main shareholder is chairman Christopher Mills, who owns 30 per cent through his company Harwood Capital.
EKF is also backed by Lombard Odier Investment Managers with 9.4 per cent, Canaccord Genuity Wealth Management with 6.1 per cent and Schroders Investment Management with 4.9 per cent.
Why should you invest? It’s a profitable, growing business that has just proposed paying its maiden dividend of 1p per share.
Analysts at N+1 Singer have given it a target price of 40p and argue shares are currently ‘undervalued, given the multiple opportunities ahead’.
And why you shouldn’t It can be risky investing in companies that are involved in developing medical technologies.
Tight regulation, high development costs and the speculative nature of some early-stage ideas mean returns can take several years to materialise, if at all.