Top broker still sees value in the Pro Medicus (ASX:PME) share price

One leading broker believes this high-flying ASX share can continue to soar…

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The Pro Medicus Limited (ASX: PME) share price was on form on Thursday.

The health imaging company’s shares rose over 3% to $47.61.

This means the Pro Medicus share price is now up almost 36% since the start of the year.

Why did the Pro Medicus share price storm higher?

Investors were bidding the Pro Medicus share price higher on Thursday after the company announced a deal with healthcare giant Mayo Clinic.

According to the release, the company’s Visage Imaging business has signed a multi-year research collaboration agreement with Mayo Clinic that will facilitate development and commercialisation activities in the field of artificial intelligence (AI), leveraging the Visage AI Accelerator platform.

Can its shares go higher?

According to a note out of Goldman Sachs, its analysts still see value in Pro Medicus’ shares.

This morning the broker has retained its buy rating and $53.80 price target on the company’s shares. Based on the latest Pro Medicus share price, this implies potential upside of 13% over the next 12 months.

Goldman commented: “PME today announced that it has signed a multi-year research collaboration with Mayo Clinic, one of the leading academic healthcare networks in the US. This agreement will facilitate the two parties’ research efforts around Artificial Intelligence in the field of radiology, with the primary aim of developing/commercialising new products.”

“Following today’s announcement, we highlight that PME has now established R&D collaborations with three different, world-renowned healthcare networks. These efforts have already yielded an interesting commercial opportunity, which could provide a material revenue contribution from FY22. We believe the strategy of partnering with the leading academics helps to maximise the value and competitive advantage of PME’s technology proposition,” the broker commented.

In light of the above, this could make it worth considering Pro Medicus at the current level.

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James Mickleboro does not own Pro Medicus shares. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Pro Medicus Ltd. The Motley Fool Australia owns shares of and has recommended Pro Medicus Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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