Healius Ltd (ASX: HLS) shares are having a very strong session on Thursday.
In morning trade, the pathology services company's shares are up over 17% to $1.54.
This follows the release of the ASX 200 stock's investor day presentation.
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Why is this ASX 200 stock surging today?
Investors have responded positively after the company released a detailed transformation plan and revealed positive trading momentum for 2025 and plans to pay a special dividend.
Let's take a closer look at what's driving the sudden burst of buying.
Refreshed strategy and simplified structure
Following the sale of its Lumus Imaging business for $965 million, the ASX 200 stock has repositioned itself as a pure-play pathology and diagnostics company.
With a new CEO, refreshed board, and streamlined national operating model now in place, management has set its sights on delivering high single-digit EBIT margins by FY 2027 under a plan dubbed "T27".
A major focus will be on simplifying the business. Healius has already identified $15 million to $20 million in cost savings — mainly from removing unallocated corporate expenses — and has several programs in place to reduce labour, consumables, and logistics costs across the network.
Trading momentum returning
Also going down well with investors has been the release of a solid trading update.
The ASX 200 stock revealed that year-to-date to February 2025, pathology volumes were up 4% while revenue increased by 6.2%, signalling that the underlying business is starting to regain traction.
These figures appear to support the company's confidence in achieving its margin targets over the coming years.
Big dividend coming
But perhaps the most excitement came from its announcement of a $300 million special dividend.
Healius revealed that it intends to pay a special dividend of 41.3 cents per share, fully franked, subject to completion of the Lumus sale. That deal is expected to close on 1 May, which means that pay day won't be too far away if everything goes to plan.
And it certainly would be worth the wait. Based on yesterday's close price, this payout represents a stunning 31.3% dividend yield.
Should you invest?
Prior to today, none of the major brokers had buy ratings on the ASX 200 stock. The most bullish was Macquarie with its neutral rating and $1.40 price target. However, this price target is below where Healius shares trade today.
Though, it is possible that analysts will be updating their estimates and recommendations after running the rule over this update. So, stay tuned for that in the coming days.
