March was certainly a sore month for investors. The health crisis surrounding the COVID-19 pandemic took a heavy toll on the ASX, sending most share prices sharply downward.
And it was no different for ASX healthcare shares. The S&P/ASX 200 Health Care Index dropped around 23% during March before rallying strongly in the final week to end the month down around 6%.
Below are two ASX healthcare shares that saw their share prices smashed throughout the month.
Ramsay Health Care Limited (ASX: RHC)
Australia's largest private hospital operator was by no means immune to the market conditions in March. Volatility in the Ramsay Health Care share price ran wild along with the market.
In fact, its shares dropped over 30% before recovering half of this fall to finish March around 15% lower from where they started. Dizzying for a large global company firmly part of the S&P/ASX 200 Index (ASX: XJO).
Why all the share price volatility?
The Ramsay share price has been bouncing around thanks to a string of announcements made by the company in March. Initially, Ramsay followed many companies and announced the withdrawal of its guidance for FY2020, sending its share price lower. This continued a week later with Ramsay shares falling sharply after the government announced its intentions to stop elective surgeries.
However, its shares surged shortly after when Ramsay confirmed it was in discussions with the Australian Government regarding its capacity to provide support as part of the Government's COVID-19 response.
In addition to this, it was later announced that the Australian Government offered a viability guarantee in return for assistance, with Ramsay confirming it is in discussions with the Australian Government regarding its support.
Monash IVF Group Ltd (ASX: MVF)
As the name suggests, Monash IVF develops assisted reproductive technology (ART). IVF is one of the more widely known types of ART. In fact, the pioneers of Monash IVF achieved the first IVF pregnancy in the world back in 1973. Since then, it has grown clinics throughout Australia, offering a range of different fertility treatment options.
How did Monash IVF perform in March?
Monash IVF shares have had a tough 12 months thanks to an announcement surrounding the departure of a high-volume doctor. However, March was particularly unforgiving. The Monash IVF share price crashed almost 60% to a low of just $0.38. Since then, its shares pushed a little higher to close the month 50% lower at $0.445, which is where they're sitting now at the time of writing.
Recent announcements
Yesterday, Monash joined the long line of ASX companies making the decision to defer its interim dividend. Prior to this, Monash also withdrew its FY20 guidance, citing the uncertainty of current economic conditions and supply-side risk caused by the COVID-19 pandemic.
Additionally, the National Cabinet, acting on the advice of the Australian Health Protection Principal Committee, has temporarily suspended all non-urgent elective surgeries. These new rules apply to both private and public hospitals in every state.
Patients that commenced treatment prior to the temporary suspension are expected to complete treatment. However, Monash's fertility activity will be significantly impacted, leading the company to the decision to defer payment of its interim dividend. This dividend payment of 2.1 cents per share has been deferred from 3 April to 2 October 2020. Additionally, the interim dividend payment will be subject to further COVID-19 developments and the financial position of Monash at the time.
Management said that the decision to defer the dividend was not taken lightly. However, it was a prudent measure to preserve cash in the current economic environment and will assist in ensuring the business is well-positioned for the anticipated recovery.
Foolish takeaway
The majority of ASX shares fell sharply lower in March. However, I believe we will look back to see that it was a great buying opportunity – an opportunity to buy shares beaten down from (hopefully) shorter-term pessimism. I also believe April may provide a similar circumstance.
