Volpara Health Technologies Limited

Section 1: Company Overview and Fundamentals Insights

1.1 Company Overview

Volpara Health Technologies Limited (ASX: VHT) is engaged in selling and providing services in the medical device and practice management software industry.

1.2 The Key Positives, Negatives, Investment Highlights, and Risks

1.3 Top 10 Shareholders: The top 10 shareholders together form ~37.83% of the total shareholding. Harbour Asset Management Limited and Allen (Roger) are holding a maximum stake in the company at ~13.11% and ~7.33%, respectively.

1.4 Key Metrics: The accounts receivable turnover ratio in FY22 was around 2.9x, which increased from 2.4x in FY21. The asset turnover ratio improved from 0.24x in FY21 to 0.30x in FY22. Below is captured the trend of debt-to-equity ratio and inventory turnover ratio:

Section 2: Business Updates and Financial Highlights

2.1 Business Updates:

2.2 Results Highlights of 2QFY23: The company raised approximately NZD 132mn since its listing on the exchange in April 2016. Further, VHT has no debt on its balance sheet, but only a revolving credit facility of NZD 10mn is in place with the company's main commercial bank.

2.3 Operational Update: The US Food and Drug Administration (FDA) provided a statement that it can roll out the final rule of the Mammography Quality Standards Act (MQSA) by the end of 2022 or early 2023.

Section 3: Key Risks and Outlook:

Section 4: Stock Recommendation Summary

4.1 Price Performance and Technical Summary

4.2 Fundamental Valuation

Valuation Methodology: EV/Sales Per Share Multiple Based Relative Valuation (Illustrative)

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is neither an indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is November 16^th, 2022. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock.

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.

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