Integral Diagnostics/IDX

IDX (diagnostic imaging company) has been something of a market darling for small cap managers.

The track record of sales growth is admittedly excellent.

But EBIT growth is proving more elusive. The balance of power sits with labour, and that’s the biggest cost they face. No margin recovery, as yet. The stock is on depressed earnings, but that still translates to a forward PE of 22x.

Not one for us, just yet. The gearing is quite high, and one more poor result could see the dreaded “dilutive cap raise”.

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