Analysts at Macquarie believe there are several significant tailwinds for ASX All Ords healthcare stock Integral Diagnostics Ltd (ASX: IDX) in the coming year, and have a bullish price target on the company's shares.
Integral Diagnostics provides diagnostic imaging services such as magnetic resonance imaging (MRI), ultrasound, and radiography at 145 sites across Australia and New Zealand. The Macquarie team says the company stands to benefit from programs such as the National Lung Cancer Screening Program, which the federal government is tipping $264 million into.
The company will also benefit from a boost to bulk-billing, according to Macquarie:
Success in CT lung cancer screening, supported by $264m in government funding and Integral Diagnostics' expected 20% market share, is partly offsetting a slower MRI ramp. The upcoming $7.9bn expansion of bulk billing from Nov-25 should boost GP volumes and imaging referrals, particularly in regional areas where Integral Diagnostics is strong. We forecast FY26 domestic organic revenue growth of 8%.
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Several pillars to growth
The Macquarie team said synergies from the 2024 merger with Capitol Health, ongoing clinic investments and expansion of the GP bulk billing program would all be "fully realised" in the current financial year.
These factors, combined with procurement efficiencies and an expected shift of patients from public emergency departments to GP channels, position Integral Diagnostics for a step-up in margins in the second half.
The Macquarie team said the company could also increasingly shift work to radiologists working remotely, allowing for more flexibility in staffing, supporting EBITDA margin forecasts.
As the analysts said:
We see several significant tailwinds for Integral Diagnostics over FY26, with expected ongoing mix shift benefits to higher fee modalities supported by MRI deregulation, CT lung cancer screening programs. Higher annualised cost savings further supports our EBITDA margin expectations.
The Macquarie team have a 12-month price target of $3.40 on Integral Diagnostics shares, and including dividends, are forecasting a total shareholder return of 32.2% over the next year.
Integral Diagnostics declared a fully franked final dividend of 4 cents per share in August, bringing the full year payout to 6.5 cents per share.
Integral Diagnostics shares were changing hands for $2.59 on Tuesday, up 0.7%.
Macquarie said in a separate research note to clients earlier this year that it preferred Integral Diagnostics to Australian Clinical Labs Ltd (ASX: ACL), which it had a neutral rating on.
