Shares in Medical Developments International Ltd (ASX: MVP) are down slightly more than 20% over the past 12 months, but according to the analysts at Bell Potter, there could be some serious upside from here.
Bell Potter has a buy recommendation on the shares and a bullish share price target, which I'll get to shortly. First, let's look at the company's recently released full-year results.
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Modest uplift in earnings
MVP last week announced a net profit of $600,000 for FY26, up from $100,000 for the previous year.
The company's revenue was up 9% to $42.6 million.
The company's main business involves the manufacture and sale of Penthrox, better known as the "green whistle" pain relief device.
MVP said in FY26, there was 28% volume growth of Penthrox in the Australian hospital segment and 18% growth in the European market.
Chief Executive Officer Brent McGregor said of the results:
We have delivered a solid financial performance in FY26 with strong cashflow generation. In our Pain Management segment we saw pleasing underlying growth, with stronger volumes in all regions. While demand in our Respiratory business was soft, pricing initiatives and lower costs helped deliver a modest improvement in segment earnings. Accelerating Penthrox volume growth was our priority in FY26. We are delighted by the progress we have made in the period on several important initiatives. This included obtaining regulatory approval for the paediatric indication of Penthrox in the UK and Europe. Penthrox can now be used by children 6 years of age and older in these markets – an important milestone for the Company. We expect to see benefits from access to the broader addressable market in future periods.
For FY27, MVP said it expected higher demand for Penthrox in Europe, "supported by the paediatric indication in Europe and the recently published health economic data''.
The company said the impact of Middle East supply chain disruptions and US tariffs on earnings remained uncertain and continued to be monitored.
Shares looking cheap, broker says
Bell Potter said in a note to its clients that the result was broadly in line with expectations and that the company was poised for growth.
They said:
The completion of the transition in the European distribution arrangements for Penthrox lays a foundation for MVP to focus on improving demand and utilising the recent health economic analysis, published in "Emergency Medicine Australasia" to accelerate hospital adoption across geographical markets. MVP will be seeking to selectively open new markets, leveraging existing approvals and work towards improving the economic value of Penthrox.
Bell Potter has a price target of $1 on MVP shares compared to 50 cents currently.
MVP is valued at $56.3 million.
