# MVF - Monash IVF Group



## System (11 June 2014)

Monash Group is a leader in the field of fertility services and one of the largest providers of Assisted Reproductive Services (the most significant component of fertility services) in Australia and Malaysia.

Services are provided to patients in Australia through 12 permanent fertility clinics, six satellite clinics, six ultrasound clinics, two specialised diagnostics laboratories and one day hospital. Services are also provided from one permanent fertility clinic in Malaysia.

http://www.monashivfgroup.com.au


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## pixel (10 September 2014)

... and after only two months since listing, S&P have already promoted MVF into the ASX Top300.

I hadn't heard of them until my Trinity Scan brought the code up a couple of days ago.





Today, I bought some on the pullback.


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## DeepState (10 September 2014)

pixel said:


> ... and after only two months since listing, S&P have already promoted MVF into the ASX Top300.
> 
> I hadn't heard of them until my Trinity Scan brought the code up a couple of days ago.
> 
> ...




Is this a purely technical play for you?  

The inclusion was announced on Sep 5 where you can see the stock price jump. This may be the price action that attracted your interest. The actual implementation is scheduled to take effect from Sep 19.  Vanguard tracks the ASX 300.  They tend to pyramid the trade into the inclusion date and possibly through it in order to contain tracking error whilst allowing for liquidity concerns. There is comfortably enough liquidity as they will need to buy about 2m shares to fully hedge and will likely do this through the reconstitution period. At a guess, they will trade 10% of ADV.  However, others will be piggy-backing the trade and there are technical players who will also effectively be doing so, but with a lag. Not too many others track the ASX 300, the bulk index funds tend to track the 200 due to available liquidity. MVF s not being added to the ASX 200 this round.


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## goccipgp (11 September 2014)

MVF has been showing support at 1.60 and resistance at 1.773. Technical buying signal at au stoxline with the target price of 2.071 in six months.


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## pixel (11 September 2014)

DeepState said:


> Is this a purely technical play for you?
> 
> The inclusion was announced on Sep 5 where you can see the stock price jump. This may be the price action that attracted your interest. The actual implementation is scheduled to take effect from Sep 19.  Vanguard tracks the ASX 300.  They tend to pyramid the trade into the inclusion date and possibly through it in order to contain tracking error whilst allowing for liquidity concerns. There is comfortably enough liquidity as they will need to buy about 2m shares to fully hedge and will likely do this through the reconstitution period. At a guess, they will trade 10% of ADV.  However, others will be piggy-backing the trade and there are technical players who will also effectively be doing so, but with a lag. Not too many others track the ASX 300, the bulk index funds tend to track the 200 due to available liquidity. MVF s not being added to the ASX 200 this round.




Thanks, RY, for the extensive fundamental summary. Much appreciated.

You're right: MVF is *mainly* a technical play for me. I build my watchlists primarily from technical scans across the entire ASX. When I notice a new code, especially one with promising chart features, I dig a little into their background and/or ask questions. That way I also became aware of their being included in the Top 300. 

As a trader, I look for a setup where a stock comes off support, showing a likely turn of momentum. Where appropriate, I wait for a pullback from Primary Resistance, then start buying (under certain conditions) at or near the first higher Low. MVF ticked not only the technical boxes at $1.70, but also many fundamental ones. If the Market continues to like it, I'm happy to stay on for the ride; otherwise I'll stop out and move on.


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## pixel (12 September 2014)

Today's Special Crossing of 3.75M shares at $1.72 suggests that there is still considerable interest in this stock. The price may not  be very volatile as yet, but that is a common occurrence, especially when some significant holdings are in play. With Millions of shares at their disposal, it costs peanuts to keep little fish like us from creating any volatility that might push the share price outside their zone of interest.


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## pixel (19 September 2014)

Following the pullback to 61.8% of the latest trading range, I had been looking for a break and re-test of the Primary Resistance. Have bought more @ $1.75 which I now expect to turn into Support. I'll allow a couple of cents leeway before activating Plan B (= stop out). Plan A has a calculated target of $1.85 +.


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## DeepState (24 October 2014)

Anyone doing work on MVF-AU? 











Disclosure: Holder MVF.


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## DeepState (24 October 2014)

Important because the nature of procedures undertaken tilts towards implantation of existing embryos which is different to a decade ago when it was tilted towards harvesting eggs for implantation.  Highlights technological risks to the earnings stream.


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## VSntchr (25 October 2014)

RY - I'm not a holder of MVF. But I think its an interesting industry and one that is supported by favourable macroeconomic backdrop. It seems probable that growth rates for cycles will exceed broader GDP growth over the coming decades - due to a number of factors such as declining fertility (due IMO to poor health and environment), increased IVF awareness, new market penetration, female workforce participation, lifestyle choices delaying pregnancy etc etc.

As for MVF specifically, was there anything qualitative that led you to pick them over VRT?


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## DeepState (25 October 2014)

VSntchr said:


> As for MVF specifically, was there anything qualitative that led you to pick them over VRT?




Thanks VS.  This is a stand-alone investment for us.  I am interested in the absolute valuation.  In forming the valuation, consideration will be given to the metrics relevant to VRT.


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## herzy (25 October 2014)

DeepState said:


> Thanks VS.  This is a stand-alone investment for us.  I am interested in the absolute valuation.  In forming the valuation, consideration will be given to the metrics relevant to VRT.




Could you summarise the reasons for your investment? Macroeconomics aside. 

This comes partly from laziness and largely from interest. I find biotech extremely hard to evaluate as a punter, which is a shame given my interest and despite having a BSc. 

On an unrelated note, when you say 'us', do you mean The Boat Fund perchance?


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## DeepState (26 October 2014)

herzy said:


> Could you summarise the reasons for your investment? Macroeconomics aside.
> 
> This comes partly from laziness and largely from interest. I find biotech extremely hard to evaluate as a punter, which is a shame given my interest and despite having a BSc.
> 
> On an unrelated note, when you say 'us', do you mean The Boat Fund perchance?




Sorry to be obtuse.  The reasons for our current exposure are extremely unlikely to be of interest from an investment perspective.

Us/Our? Oh, I've slipped into plural.  It's my imaginary friend.  Haven't seen her in a while.


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## burglar (27 October 2014)

DeepState said:


> Sorry to be obtuse.  The reasons for our current exposure are extremely unlikely to be of interest from an investment perspective.
> 
> Us/Our? Oh, I've slipped into plural.  It's my imaginary friend.  Haven't seen her in a while.




Are you starting a family?


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## DeepState (27 October 2014)

burglar said:


> Are you starting a family?




That's an interesting take!  Nah, we (this 'we' is for real) started and finished starting one some time back.  We were fortunate enough not to have to draw upon the science. 

Nonetheless, MVF and VRT etc do amazing work to bring that possibility to others. Something around 4% of all births in Aust come with the help of IVF technology.  Everyone knows someone who started a family with this assistance or who is trying to do so.  The pioneers of the IVF techniques were freaks of nature.  Carl Wood was the leader in Australia.  His team successfully developed Australia's first IVF birth in 1980 (not the first in the world, the first was in 1978 and Edwards won a Nobel for it).  They went on to become MVF.  My jaw drops every time I think of the complexity of what these people managed to overcome and harness.  

Anyway, it's the investment case I'm ultimately interested in.  The outcome will be what it will be.


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## DeepState (28 October 2014)

AGM with Q1 2015 update. 

Neg surprises on fresh vs frozen embryo transfers (as opposed to peas), market growth, price competition, direct competition for low intervention centers, did not discuss other price competition emanating from Sydney into key markets, delays in commissioning...but it's ok because tax losses from the IPO will help to lift the outcome to the prospectus target for 2015.  Really.

Upsides: diagnostic services doing well. Chairman re-elected with nearly unanimous outcome.

Looks like franchise decay going on.  A -13% move today.  Seems excessive for the news in isolation but I don't have a handle on valuation to be concrete on this. Consensus is 12.1x FY15. Not immediately suggestive of overvaluation.  Float got away four months ago at 16.4x pro-forma FY15. VRT-AU trades at 16.9x FY15.  Stock has been falling since a few weeks post IPO. Now 138 vs 185 IPO price.

Preliminary thought is that a decent portion of the price decline over recent months is related to liquidity rather than fundamentals.  VRT-AU should be faced with the same difficulties (and was sold down somewhat today) and it seems odd that a valuation multiple for FY15 should be so different on face value.  Which is expensive and which is cheap?  Maybe it's both.  At the moment...dunno.


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## DeepState (1 December 2014)

Some factoids from the research effort thus far:

Reproductive 'intensity' by state is important given the geographic nature of competition.  Also, way to go Burgs....




Signs that work stress contributes to reduced fertility...


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## DeepState (1 December 2014)

Some base data required for projection of IVF and related market unit demand.

Number of women in the population for different age bands as projected by the ABS on the assumption of current net immigration rates (hence probably conservative):



The prime group for IVF demand are women in the 30s.  Hence growth rate assumptions will heavily depend on the number of women in this age bracket and how that evolves through time:



Demand for IVF results from infertility or difficulty in conceiving.  These are the natural rates of conception in a 12 month period.  Generally, after this time, a patient becomes a core candidate for IVF treatment of some sort, or at least investigating the possibility:



The age at which women are having children has been increasing but has become more stable in the last five or so years.  Part of the growth rate experienced for IVF has come about because the number and proportion of women having children later has increased faster than by demographic trends more generally.  These lifestyle choices produce a rate of growth which, all else equal, should not be used as a base case growth rate going forward.



By blending these results with Medicare claims data and household confidence data, it is possible to get a reasonable basis for projections of IVF unit demand.  Demographic data is very stable.

The key unknowables aren't really about market-wide demand.  They come down to Medicare support (demand for IVF is amazingly dependent on household confidence and hence price sensitive), bargaining power of the IVF specialists and technological breakthroughs.  There are also efforts to break the market apart with bulk-billing services.  These can only be loss-leaders as no amount of scale benefit could make this profitable.  Everyone with a growth story is looking for a greater geographic footprint in Australia and elsewhere.  This market is like McDonalds.  The service is ultimately a burger.  Clients just go to the most convenient one that more or less does the job.  It's a real-estate play as much as anything.


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## skc (1 December 2014)

DeepState said:


> Some base data required for projection of IVF and related market unit demand.
> 
> The prime group for IVF demand are women in the 30s.  Hence growth rate assumptions will heavily depend on the number of women in this age bracket and how that evolves through time:
> View attachment 60542




It's not just about women. There's something in the water about the men as well.

http://www.abc.net.au/news/2013-02-05/more-tv-means-less-sperm-study/4502820



> It found those who watched 20 hours or more of television per week had a 44 per cent lower sperm count that those who responded that they watched none or almost none.






> Men who did 15 or more hours of moderate to vigorous exercise per week were found to have a 73 per cent higher sperm count than those who exercised less than five hours per week.






> "There are some studies that have been done that have shown that sperm counts are falling as the generations go by, but other studies carried out in different countries can't see any effect.
> 
> "It's an uncertain, and at the moment still an unknown, area."




Coupled with women starting to have kids in their 30s... when their male parters are likely to be in the 30s as well. Chances are the men exercise would also be less in that age cohert.


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## coolcup (1 December 2014)

Hi Retired Young

Are the charts your own analysis? If so I am very impressed. Is the data all publically available from the ABS or did you have to spend a long time digging it all out?

Great post by the way.


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## DeepState (2 December 2014)

skc said:


> It's not just about women. There's something in the water about the men as well.
> 
> http://www.abc.net.au/news/2013-02-05/more-tv-means-less-sperm-study/4502820
> 
> ...




Correct. Thanks as always. 

This analysis focuses on women as they are the delivery portal of the end fulfillment good. 

However, it has always taken a man and a woman to make a baby - at least that's what they taught me.  Unless the nature of the relationship between the age of men and women has changed a lot, the outcome can be represented by analyzing women alone as the base unit.  All else equal, as male fertility declines with age, the fertility of a woman, as measured by these stats, falls as well by some amount.  For any given age bracket the fertility would remain more or less similar (assuming male fertility is not changing materially through time).  Reduced population fertility arises because there is a trend towards older parenthood.

Your point would be very pertinent if there was a growing age difference between men and women who enter into an arrangement of some sort to have a child.  I am not aware of anything that is material on this or have any reason that it will change in one direction through time looking forwards.  For a ten year 'explicit' forecasting horizon, population dynamics on this matter are pretty much set.  It would be a worthy study for the IVF community and the ABS to examine whether the fertility rates of cougars or those who seek sugar daddies differs materially from those of their age-appropriate/conformist matched controls.  If so, we'd need to allow for changing cross sectional properties if there was evidence of trends in this direction.  Birds and bees will do as they do.

Nonetheless, I went for a bike ride today.


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## DeepState (2 December 2014)

coolcup said:


> Hi Retired Young
> 
> Are the charts your own analysis? If so I am very impressed. Is the data all publically available from the ABS or did you have to spend a long time digging it all out?
> 
> Great post by the way.




Hi CC.  All of the underlying data shown was sourced from the ABS and the MVF prospectus.  Medicare stuff comes from Dept of Human Services and household confidence measures come from ABS and other surveys like Westpac-MI.  You need to mash these all together to arrive at base rates for unit demand.  That's just a step to determining line #1 (Revenue) of the valuation, of course.

It's not hard to dig up after wasting days figuring out what you need and what is available!


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## coolcup (2 December 2014)

DeepState said:


> Hi CC.  All of the underlying data shown was sourced from the ABS and the MVF prospectus.  Medicare stuff comes from Dept of Human Services and household confidence measures come from ABS and other surveys like Westpac-MI.  You need to mash these all together to arrive at base rates for unit demand.  That's just a step to determining line #1 (Revenue) of the valuation, of course.
> 
> It's not hard to dig up after wasting days figuring out what you need and what is available!




Brilliant stuff mate, and thank you for sharing. A lot of the type of research you are doing ends up being proprietary!


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## johnpendles (8 December 2014)

the biggest issue relates to the government rebates. currently IVF treatment is rebated heavily. will the government continue to support these treatments? 

certainly Australia is a "pro-natalist" country. most of its policies are centred around trying to increase the population.

-immigration
-baby bonus payments
-paid maternity leave
-family tax benefits 

etc etc

whilst funding for IVF is significant, economic modelling has shown that above all other policies aimed at increased the birth rate, IVF is the one that provides a significant return on investment. i.e., you are creating a life where one was not otherwise going to be achieved (for that couple) and over the course of that new life that IVF has created, the country gets back what it paid for in helping create it.


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## DeepState (8 December 2014)

johnpendles said:


> the biggest issue relates to the government rebates. currently IVF treatment is rebated heavily. will the government continue to support these treatments?
> 
> certainly Australia is a "pro-natalist" country. most of its policies are centred around trying to increase the population.
> 
> ...




Yep, it's the single biggest event risk.  The management view on this is that is represents less than 2% of Medicare expenditure and would lose votes in middle Australia worth more than any budgetary saving.  That said, who knows?  What I am amazed at is how price sensitive demand is for this service.  I would have thought that wanting a child comes ahead of mortgage payments.  Apparently it is a discretionary luxury item.  Hang on a minute...why was I surprised?  Loss of this support would cut the demand by at least half as the price for the service in full mode doubles.  Perhaps demand for the budget version would compensate in some way.  It's still quite new.

You've made a great argument on the national ROI for the expenditure assuming that a birth is a net addition to the national wealth on average (I never thought of it that way at all, or even anything like it - thanks) and all the other things which point towards the maintenance of the payment if the nation wishes to grow (as it does).


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## johnpendles (9 December 2014)

DeepState said:


> Yep, it's the single biggest event risk.  The management view on this is that is represents less than 2% of Medicare expenditure and would lose votes in middle Australia worth more than any budgetary saving.




I was of the opinion that cutting IVF funding would be very difficult to do politically. But then the government tries to introduce a $7GP tax. If they have balls to try and introduce something like that, then i guess anything is fair game.

Although, we've seen today that the government is pretty much scrapping this cash grab. 

As you have previously said, one child in every class room, on average, is born though IVF or IVF type treatments. A large portion of the public. It would be seen as quite cruel to try and make it harder for infertile couples to achieve their dream of having a baby.

Doctors have a very very good "union" in the AMA. Whenever the government tries to mess with their item numbers of rebates, they are very good at informing the public, rightly or wrongly, how the proposed changes adversely impacts their health. 

With regards to the price sensitivity of IVF. There would be few couples who accept childlessness due to the cost of IVF. Where price has an impact is on how quickly they are willing to resort to IVF type treatments. If it's cheap enough some may be willing to go down the path after 6-8months of not being able to fall pregnant, but if it's a bit more expensive then they may have to wait 2yrs etc.


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## DeepState (9 December 2014)

johnpendles said:


> With regards to the price sensitivity of IVF. There would be few couples who accept childlessness due to the cost of IVF. Where price has an impact is on how quickly they are willing to resort to IVF type treatments. If it's cheap enough some may be willing to go down the path after 6-8months of not being able to fall pregnant, but if it's a bit more expensive then they may have to wait 2yrs etc.




John, thank you for your thoughts again.  This is what I learned about IVF price sensitivity.  Please let me know your thoughts on the following.

This is the number of new cycles commenced in a given calendar year from Medicare (Item# 13200).  It shows a steady rise and was hit around a year after the GFC came into full force.  If it were a delayed issue, we would have seen a pick up by now as those requiring IVF are time sensitive and it has been four years since the last peak. The population is also moving in a way that there are more women in the zone to want IVF as well.






They appear price sensitive in the sense that demand for IVF moves with ability to feel confident in their ability to pay for the service and the aftermath.  This is the ANZ Job series.  There is a clear link between this concept of job security and a lagged flow through to the IVF starts as would be expected (this would partly encompass the delay effect you are talking about and the time taken to react to changes in economic circumstances more generally).




I was surprised to see how pro-cyclic IVF demand is.  I would not have thought it would be so large.


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## McLovin (9 December 2014)

DeepState said:


> I was surprised to see how pro-cyclic IVF demand is.  I would not have thought it would be so large.




Hi RY

I was shocked too! I did a little research. From 2009/2010 it appears a new item 13201 was added which appears to be identical to 13200 (See here). When the two are added together it's not anywhere near as cyclical. Not sure if they should be added though or why they have split them into two reporting codes! Sorry, I would have put it into Excel but I'm on a Mac and I suck at using their spreadsheet program.


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## skc (9 December 2014)

DeepState said:


> I was surprised to see how pro-cyclic IVF demand is.  I would not have thought it would be so large.




I think price sensitivity is not the right word, but it makes sense for IVF demand to rhyme with the economic cycle.

The cost of IVF is actually very small relative the present value of the direct and indirect costs of raising a child.


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## johnpendles (9 December 2014)

I think your points are very valid. 

I would be interested to see what the effects of GFC type events have on the birth rate in general.

ie, during suboptimal economic conditions where consumer confidence is affected are people concerned about their ability to pay for the upbringing of children. 

I would say, to a point, that this plays a factor.

I dont think its too much of a stretch to say that in times of economic despair, such as the GFC, where people lose their jobs or face a significant income cut that they would think twice about having children, whether that be via natural means or via IVF. The fact that IVF costs money would certainly amplify the potential effect on that cohort of the population (i.e. those considering fertility treatment). 

the other thing i'll mention with regards to your graphs, there may be other factors that have played a part. for example, the medicare safety net. if that was risen at some stage during that graph, that would have had an effect on the demand for fertility treatments. 

and one final thing. i suspect that the demand for fertility treatments from "first time" patients may not actually change that much. i.e., patients that have no children and desperately want a child and have yet to have any fertility treatment. my guess is that those couples would, for the most part, go ahead and pay what it takes (to a point) to make their dreams come true. so for that cohort of patients, they may not be so price sensitive as the graph suggests. but, for patients that have already had 3 cycles of IVF without success, have sunk thousands of dollars on other things such as scans, blood tests or surgery, the thought of spending another couple thousand dollars or so on another cycle of IVF probably doesn't sound too appealing during times of sub-optimal economic conditions. my guess its this cohort of patients that might say "enough is enough". its this cohort that may be quite price sensitive. 

but people need to remember, the cost of fertility treatment is a tiny fraction of the cost of having a baby and bringing up a child. so to me, it makes no sense that people would not want fertility treatment because of the cost. but as you've shown there are certainly people out there that are willing to either go ahead with treatment or not based on the cost.


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## skc (9 December 2014)

McLovin said:


> Hi RY
> 
> I was shocked too! I did a little research. From 2009/2010 it appears a new item 13201 was added which appears to be identical to 13200 (See here). When the two are added together it's not anywhere near as cyclical. Not sure if they should be added though or why they have split them into two reporting codes! Sorry, I would have put it into Excel but I'm on a Mac and I suck at using their spreadsheet program.




Ahh... there's a simple explanation to many things! Great work.

http://www.medicareaustralia.gov.au/provider/pbs/drugs1/ivf-gift.jsp

13200 refers to the first cycle. 13201 refers to subsequent cycles.


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## DeepState (9 December 2014)

skc said:


> Ahh... there's a simple explanation to many things! Great work.
> 
> http://www.medicareaustralia.gov.au/provider/pbs/drugs1/ivf-gift.jsp
> 
> 13200 refers to the first cycle. 13201 refers to subsequent cycles.




...and also to McLovin

Really appreciate your input (you too John). This is ASF on heat.

Add 13202 for discontinued cycles and you have the stat for all cycles commenced.  This has been smoother than for initial.  What that means is that there are less people undergoing IVF treatment but that those who do are getting more cycles done (an automatic stabilizer??   )

I think that these two features need to be broken apart.  These are just people wanting to get pregnant and give birth to a child.  That number is #13200.  These are sort of new client acquisitions (actually, no.  It is the number of first cycles in a calendar year).  From there, you get spend per client.  Spend per client is clearly rising, but that is not going to infinity.  Median number of efforts per client is now three.  With improved technology, that figure has downside risk.

So, both figures have value depending on purpose.  I used #13200 because we were talking about efforts to get pregnant and this was the closest figure I can get to it.  The actual number of clients starting IVF from scratch would be lower than the figures shown and the real cyclicality in the figure would be more pronounced than what was shown.

I've made no progress on this baby.


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## So_Cynical (10 December 2014)

DeepState said:


> Median number of efforts per client is now three.  With improved technology, that figure has downside risk




1st effort success rate is the highest at around 60% from memory
2nd effort success rate drops by half to around 30%
3rd effort down to about 10%

That's why few continue.


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## DeepState (10 December 2014)

johnpendles said:


> I think your points are very valid.
> 
> I would be interested to see what the effects of GFC type events have on the birth rate in general.
> 
> ...





John, I hope that you will see fit to continue to probe like this.  I find it extremely valuable.  

There was a Medicare cap on IVF that was introduced in 2010.  There are ongoing squeezes already baked in for the Medicare Extended Safety net.  The introduction of this cap can only be a negative influence on IVF.  It coincides with the 'confidence/ability-to-fund' indicator (ANZ job ads).  Hence, we cannot break it apart easily.

MVF-AU has been crushed following an update of trading.  A good part of the reason for that was competition in SA.  A local operator was discounting and pulled a chunk of clients away.  I can tell you that Primary Health is also offering a bulk-billed service which is in ramp up.  Price clearly affects the buying decisions.  Sydney IVF has halted price increases as the 2015 round of Medicare limits bites.

Your question about births is fantastic.  Here are the stats:




Births show high resilience to changes in economic circumstance.

The natural extension of this is that IVF is affected by confidence and prices.  It looks like the number of people wanting IVF changes rather a lot because of it.  it is likely that there was some pull forward of demand ahead of the cap implementation, boosting the 2009/10 figure and troughing the 2010/11 figure.  This would make the confidence indicator a better explanatory variable too.

This helps me to gauge the extent of potential for price competition to impact outcomes in a market with low/moderate barriers to entry in which new entrants are happy to buy market share. It's not good.  Excess profits are not likely to be sustained.  Competition is centered around geography, but I'd drive a couple of suburbs more to save $2k and I liked the doctors equally (how would I know?). It also demonstrates that confidence is a large influence in choice to pursue IVF.  Although it is a relatively small outlay compared to the cost of raising a child, the buying decision is clearly much more sensitive to the price of the process than might be imagined.


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## herzy (10 December 2014)

Fascinating to follow this thread, thanks all. No intention of investing etc but am loving the discussion...


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## McLovin (10 December 2014)

DeepState said:


> .
> So, both figures have value depending on purpose.  I used #13200 because we were talking about efforts to get pregnant and this was the closest figure I can get to it.  The actual number of clients starting IVF from scratch would be lower than the figures shown and the real cyclicality in the figure would be more pronounced than what was shown.
> 
> I've made no progress on this baby.




The issue though is that if 13201 didn't exist before 1/1/2010 and was just bundled into 13200, which is my interpretation, it makes 13200 pretty useless as a time series to compare pre and post 2010. Doesn't it?


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## DeepState (10 December 2014)

McLovin said:


> The issue though is that if 13201 didn't exist before 1/1/2010 and was just bundled into 13200, which is my interpretation, it makes 13200 pretty useless as a time series to compare pre and post 2010. Doesn't it?




This looks much more reasonable.....set aside some (large) amount of what I said about #13200 and downstream implications about patient spend.  Thanks so much for highlighting this.

In any case, this from Australian Institute of Health and Welfare relating to changes in ART cycles from 2009 to 2010 when the cap was introduced (down 13% in Australia):




Total 13200, 13201 and 1302 items below in red (LHS) and annual rate of change in green (RHS).  These are FY not CY as for the AIHW report.  So the figures do not match.




Perhaps the effect of confidence and pricing is not as large as might have been implied (by me). This also brings things closer to John's statements.  Still, I am surprised by the magnitude of it because the effects remain very visible after that rather large revelation from you. I would have thought this was a utility based on the same ideas that have been mentioned here. It's clearly not. Think of the cumulative effect of deferment and/or decisions not to proceed relative to prior trend.... these are babies that were likely not born because of price and confidence when there seemed to be no let up in natural births.

Once again, thanks for the heads-up.


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## McLovin (12 December 2014)

DeepState said:


> View attachment 60664




You know what's interesting about that graph? The growth kicked up when the baby bonus was first introduced in 2004 and then backed off when the income test was introduced for it in 2009. The growth picked up again in 2011 when Labor introduced its PPL. Connection? Maybe. I'm a little surprised because I assumed that couples seeking IVF would be from a higher income bracket and so less affected by government subsidies.


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## johnpendles (20 December 2014)

DeepState said:


> John, I hope that you will see fit to continue to probe like this.  I find it extremely valuable.
> 
> There was a Medicare cap on IVF that was introduced in 2010.  There are ongoing squeezes already baked in for the Medicare Extended Safety net.  The introduction of this cap can only be a negative influence on IVF.  It coincides with the 'confidence/ability-to-fund' indicator (ANZ job ads).  Hence, we cannot break it apart easily.
> 
> ...




I find your statistical analysis equally interesting. Cheers.

I can not argue any of your points. 

The competition headwinds from SA have now ceased (it was basically a local provider bulk billing IVF, but this longer exists is my understanding as they couldn't sustain it). 

Your comments about geography are almost certainly true. 

MVF has up until recently had very little market share in Sydney i think? But they recently purchased Fertility East. A sydney practice. They need to get a foothold in this market. Currently it's dominated by IVF Aust (Virtus) and the independent Genea. 

Here is a recent Morgan's post on MVF:



> Monash IVF (MVF) has announced the acquisition of the Fertility East business in Bondi Junction in Sydney. MVF has paid A$3m (plus A$500,000 subject to meeting performance hurdles). Fertility East has revenue of A$5m and will be EPS accretive immediately.
> 
> The purchase price will be funded from a mix of debt and cash.
> 
> ...




http://www.morgans.com.au/Blog/2014/December/Monash-IVF.aspx


----------



## DeepState (4 February 2015)

MVF-AU looks fair value on my DCF/SOTP valuation.  It is trading materially cheap vs VRT-AU on a simple FY15 price-earnings multiple basis.

Overall conclusion is presently HOLD on a long horizon basis.


----------



## johnpendles (18 February 2015)

DeepState said:


> MVF-AU looks fair value on my DCF/SOTP valuation.  It is trading materially cheap vs VRT-AU on a simple FY15 price-earnings multiple basis.
> 
> Overall conclusion is presently HOLD on a long horizon basis.





I think the market did not like the fact that they missed their earnings predictions from the prospectus. at the AGM they explained why this occurred, but the market is fickle and the board will need to earn the market's trust back. 

looks like the market agreed with your above post. anything in particular happened in the last few days to cause the price jump?


----------



## DeepState (18 February 2015)

johnpendles said:


> looks like the market agreed with your above post. anything in particular happened in the last few days to cause the price jump?




JCP came in with a substantial.  Ladies and Gentlemen, the smart money is back.  Shadow boxing.

Thanks for your assistance with this, John.  Shall send you a copy of my analysis via PM.


----------



## johnpendles (18 February 2015)

No problem mate. 

I should disclose that I am a shareholder. I do not want to be accused of "ramping". 

May I ask, what do you mean by this:



> Ladies and Gentlemen, the smart money is back. *Shadow boxing.*


----------



## DeepState (18 February 2015)

johnpendles said:


> No problem mate.
> 
> I should disclose that I am a shareholder. I do not want to be accused of "ramping".
> 
> May I ask, what do you mean by this:




Literally...shadow boxing.  What I do when I'm rather happy about a development. It takes rather a bit. Jab-step-jab-step-cross-uppercut, a few other muay-thai things, round-house high kick...knock-out. Crowd goes beserk.  

Then I sit down again. 

Wife: "yeah, but it can go down as well".  

Would a simple, "that's good" be too much to ask? Sheesh. Tough audience.

VRT-AU popped a bit in sympathy but the dispersion in value is declining.  I can't make sense of its breadth.


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## johnpendles (18 February 2015)

DeepState said:


> Literally...shadow boxing.  What I do when I'm rather happy about a development. It takes rather a bit. Jab-step-jab-step-cross-uppercut, a few other muay-thai things, round-house high kick...knock-out. Crowd goes beserk.
> 
> Then I sit down again.
> 
> ...




haha, i see what you mean now.


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## DeepState (1 March 2015)

Quick Take-outs:

+ Downgrade based on lower than forecast Assisted Repro cycles (ARS).  Has every reason to rebound to historical norms unless infertile women have stopped wanting babies and/or men have stopped wanting to try put babies in them. I have no evidence of either.

+ Another explanation might be that ARS cycles are down because Fetal transfers (FET) are becoming so successful.  Revenue per treatment is down because the mix of treatments is moving towards FET.  Need to look into that.  Management commentary from VRT-AU and MVF-AU makes no such statement, but they wouldn't.  

+ Interesting that Propsectus measures looked primarily at revenue per ARS.  Yet, in the HY release, more weight was placed on revenue per treatment.  Not sure which is the best way to think of it.

+ Very large increase in Fetal transfers.  Will result in a material increase in revenue per ARS cycle.  This is a technological development which is unfolding.

+ They have termed out their debt via floating for fixed over half of the debt book. Reduces any concerns on debt sustainability.  They have disclosed enough about their covenants to know what they are and how to calculate the main metrics.  Thanks.

+ Competition from SA is dusted.

+ Diagnostics are doing well.  They are the leader in the newest generation.  VRT is in catch-up mode.  This does affect ARS patient acquisitions.


Overall:

+ Pretty routine update with random pattern of movements to the downside on this occasion without any known reason why it would be a rebasing relative to an historical trend line.

+ Dividend is in-line.


Follow-up:

+ FET growth impact on ARS growth.


Other: 

+ Not worth updating the valuation on present facts.

+ What is so magical about this $1.40 level that seems like a magnet to the share price??


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## TPI (7 March 2015)

DeepState said:


> Quick Take-outs:
> 
> + Downgrade based on lower than forecast Assisted Repro cycles (ARS).  Has every reason to rebound to historical norms unless infertile women have stopped wanting babies and/or men have stopped wanting to try put babies in them. I have no evidence of either.
> 
> ...




DeepState,

Do you have any further thoughts on VRT as opposed to MVF?

Do you feel that MVF is a better play on this sector than VRT?

From my reading, VRT has the leading market share in Australia, with full service and low-cost clinics, the most  fertility surgeons, as well as market leading positions in Ireland and a new clinic in Singapore, along with genetic diagnostic testing revenue and day hospital revenue (half of which are derived from non-IVF services). So wouldn't the market leading domestic position and perhaps more diversified earnings streams make this a better choice?

In terms of intrinsic value, my rough calculations suggest MVF is still under-valued, with VRT fairly valued in broad terms.

I also read a Bell Direct research report that mentioned VRT having more older surgeons, and the risk of their pending retirements, not sure if MVF have a higher proportion of younger doctors?


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## TPI (9 March 2015)

Also until now I didn't realise there were such things as cyclical healthcare stocks, which are typically called "defensive", but there you go! So perhaps these ART stocks will come with greater share price volatility, but also greater opportunity to buy at a discount in short-term downturns.


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## DeepState (9 March 2015)

TPI said:


> Also until now I didn't realise there were such things as cyclical healthcare stocks, which are typically called "defensive", but there you go! So perhaps these ART stocks will come with greater share price volatility, but also greater opportunity to buy at a discount in short-term downturns.




ART is cyclical. It is a 'luxury', unlike pharma or getting so sick you end up in hospital.  They are price sensitive and appear impacted by macro conditions.  For DCF, some allowance for this is probably sensible.


----------



## DeepState (9 March 2015)

TPI said:


> DeepState,
> 
> Do you have any further thoughts on VRT as opposed to MVF?
> 
> ...




Have not done a lot of work into VRT.  Just looking at straight P/E, it doesn't make sense to me on face value in terms of the gap.  Per prior posts, MVF-AU looks good for a long term position to me.  I am concerned about FET technological progression and will need to investigate further.

Bigger is not necessarily better.  It also depends on the price you pay for it. Having more non-IVF revenue still links on to getting the IVF patients in.  They also come with higher proportionate costs than straight IVF.  On this basis alone, I cannot make a judgment as to whether this is a good thing to pursue.  It can also be replicated.  MVF is growing in Malaysia and has the usual upside story.  It is also branching into the same areas as per VRT-AU.  There is a first-mover advantage in that territory is claimed and would become sticky.  However, for the newer services, the field is pretty wide open.


From the MVF prospectus: 
Relatively young, limiting retirement risk: Monash Group’s top five Fertility Specialists (in terms of Patient Treatment volumes) have an average age of 47, which is relatively young for the field of Assisted Reproductive Services. In FY2013, 66% of Monash Group’s Patient Treatments were also performed by Fertility Specialists under the age of 55. Monash Group’s younger Fertility Specialists are growing their Patient Treatment volumes at faster rates than average growth rates.


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## johnpendles (12 March 2015)

Announced that MVF has purchased Sydney Ultrasound for Women, a market leading imaging service. 

Price up today despite going ex-dividend.


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## galumay (12 March 2015)

johnpendles said:


> Announced that MVF has purchased Sydney Ultrasound for Women, a market leading imaging service.
> 
> Price up today despite going ex-dividend.




Was that purchased with debt? They were already geared to the hilt with almost less than 1 value for interest coverage.


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## skc (12 March 2015)

galumay said:


> Was that purchased with debt? They were already geared to the hilt with almost less than 1 value for interest coverage.




Are you sure?

At half year interest expense was $2.4m. EBIT was $18.7m. That ratio is some order above 1.


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## galumay (12 March 2015)

skc said:


> Are you sure?
> 
> At half year interest expense was $2.4m. EBIT was $18.7m. That ratio is some order above 1.




OK, I hadnt looked at the H1 report, only the numbers for last FY, ratio was 0.95 and debt/equity was 76%.


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## skc (12 March 2015)

galumay said:


> OK, I hadnt looked at the H1 report, only the numbers for last FY, ratio was 0.95 and debt/equity was 76%.




I am not 100% certain why the numbers looked funny on last year's report. The P&L is clouded with one-off's from the IPO and other re-organisation costs, while the balance sheet had a large debt which I think was eliminated with the IPO. The lastest half year should present a picture closer to what it should look like going forward.

I could be very wrong but DeepState would probably be all over it.

The latest acquisition will be done with a mix of cash and script, with the cash component being a mix of cash on hand and debt. I have not come across any mention of the actual amount of cash vs debt (although I only skimmed the preso).


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## galumay (12 March 2015)

skc said:


> I am not 100% certain why the numbers looked funny on last year's report. ...




I realised all that you say after I had a deeper look, I shouldnt have commented really - my look had only been cursory prior to the H1 release. Now I have had time to go over everything in more detail it certainly looks much better than my first impression!


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## DeepState (12 March 2015)

The company balance sheet was substantially delivered with the IPO.  Interest is well covered.  They paid out a dividend as per policy despite knowing this was coming.

SUFW is a major acquisition for MVF-AU.  It will provide a nucleus in the NSW market which ARS/IVF services can be built around to some degree.  MVF-AU is light on in NSW.  This is a transformative move in this region.

MUFW, the dominant ultrasound (for women) provider in Vic had revenue of $5.1m for FY13 pro forma.  SUFW generated $19m in FY14.  In combination, ultrasound will make up about 20-25%% of revenue for MVF-AU.  It is the dominant player in this market.  Diagnostics is a key platform through which revenue per patient and, presumably, profit per patient is expected to grow. Genetic screening and fetal testing revenues are growing strongly too. It will also deliver revenue which is not directly linked to IVF. Looks to be a strategically a good move.  Whether it was a good move will also depend on the price.

The debt facilities are now maxed out and they drew down on cash as well from the looks of things. In the immediate term, growth will be funded from cashflow, partly through bolt-ons.   As interest rate risk has been reduced via swap agreements on floating to fixed for half the book, there is limited concern for deterioration arising from interest rate level changes.  EBITDA is accelerating rapidly as fixed cost components become ever smaller elements of the total margin.

The equity issuance is at market rates.  It's hard to tell if the deal would have been accretive in underlying had it been entirely debt financed from what has been released and the info to hand. With interest rates so low, it's not much of a hurdle to make that claim.  NPAT contribution from ultrasound was not disclosed in the Prospectus to my knowledge.  I also have no idea what the balance sheet they bought looks like.  All will be revealed in the FY report, I guess.  Some synergies should be readily achievable within the ultrasound part of the business.

Overall: Good strategic move. Well within zones of competence and within core target markets. Hard to know the valuation impact.  Shows desire to grow dynamically rather than organically.  Fast becoming more women's health and less of IVF/ARS, although that is still it's core by quite some margin.


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## SuperGlue (12 March 2015)

johnpendles said:


> Announced that MVF has purchased Sydney Ultrasound for Women, a market leading imaging service.
> 
> Price up today despite going ex-dividend.




Has it got to do with this article in the Business Spectator
Old news, with a bit more news.

"Monash IVF targets Asian expansion."

http://www.businessspectator.com.au...aceuticals/monash-ivf-targets-asian-expansion


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## TPI (12 March 2015)

DeepState said:


> Have not done a lot of work into VRT.  Just looking at straight P/E, it doesn't make sense to me on face value in terms of the gap.  Per prior posts, MVF-AU looks good for a long term position to me.  I am concerned about FET technological progression and will need to investigate further.
> 
> Bigger is not necessarily better.  It also depends on the price you pay for it. Having more non-IVF revenue still links on to getting the IVF patients in.  They also come with higher proportionate costs than straight IVF.  On this basis alone, I cannot make a judgment as to whether this is a good thing to pursue.  It can also be replicated.  MVF is growing in Malaysia and has the usual upside story.  It is also branching into the same areas as per VRT-AU.  There is a first-mover advantage in that territory is claimed and would become sticky.  However, for the newer services, the field is pretty wide open.
> 
> ...




Thanks DeepState, I think they will both do well in the longer term, though it maybe harder to pick a winner in the short-medium term. I might just hedge my bets and have a bit of both, but will ponder this further.


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## galumay (12 March 2015)

According to RBS Morgans the acquisition will mean gearing will increase to 76%, interest cover will be 6.2.


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## johnpendles (12 March 2015)

DeepState said:


> Fast becoming more women's health and less of IVF/ARS, although that is still it's core by quite some margin.




And I like this, as has been noted previously in this thread, ARS has proven to be a bit more cyclical/price-sensitive than many of us thought to be the case. By adding on additional revenues outside of the ARS sector, one would assume that the company is becoming less and less dependent on ARS. However, as you said, at it's core, its still an ARS company.


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## DeepState (12 March 2015)

johnpendles said:


> And I like this....




Regulatory risk for Australian ARS is the key event risk that is basically not able to be hedged.  This move, together with the Asian expansion, highlights how MVF is moving fast to reduce the exposure to regulatory risk in the Australian market.  

My ok-to-hold valuation made allowance for this risk and high beta.


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## johnpendles (12 March 2015)

What do you mean by "regulatory risk" ?


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## DeepState (12 March 2015)

johnpendles said:


> What do you mean by "regulatory risk" ?




Eg. Medicare rebate for various items related to IVF get halved....


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## DeepState (2 June 2015)

Need to look into developments in FET.  I don't understand it sufficiently.  

This from the H1 2015 Investor presentation:





Why is it that FET is increasing in the mix?
What do they mean by "ongoing change in clinical practice" that leads to this development?
How does this impact the number of IVF cycles undertaken?

Any assistance gratefully received.


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## DeepState (16 August 2015)

JP, I am hearing that PRY is establishing a Melbourne presence.  
What do you think of the PRY service model?


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## McLovin (25 August 2015)

Hey DS

Did you see this in the AFR?



> Doctors at Monash IVF have demanded a meeting with the board, chaired by Richard Davis, on August 31, following the resignation of two senior embryologists Tiki Osianlis and Maria Diamente.
> 
> "When conscientious and committed staff feel they have no other option than to resign from a job they have given so much to, it indicates something is fundamentally wrong," says a letter to the board signed by 29 doctors and obtained by The Australian Financial Review.
> 
> ...




http://www.afr.com/business/health/...ething-is-fundamentally-wrong-20150820-gj3gxt

Who has the balance of power here?


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## johnpendles (1 September 2015)

DeepState said:


> Need to look into developments in FET.  I don't understand it sufficiently.
> 
> This from the H1 2015 Investor presentation:
> 
> ...




PM me your questions


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## johnpendles (27 November 2015)

nice pop today

DS what did u make of earnings report?


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## McLovin (4 December 2015)

I was having a think about the implications for the end of the one child policy. The way wealthy Chinese buy up Australian baby formula got me thinking, will wealthy Chinese couples come to Australia to get their IVF done here because of better regulation etc? I don't know whether the answer is yes or no, just something that I think might have the potential to really benefit guys like MVF.

Anyone?


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## Ves (4 December 2015)

McLovin said:


> I was having a think about the implications for the end of the one child policy. The way wealthy Chinese buy up Australian baby formula got me thinking, will wealthy Chinese couples come to Australia to get their IVF done here because of better regulation etc? I don't know whether the answer is yes or no, just something that I think might have the potential to really benefit guys like MVF.
> 
> Anyone?




Here's an article you might find interesting.

http://www.cnbc.com/2015/11/30/end-of-one-child-policy-means-mayhem-in-chinas-ivf-sector.html

Basic premises:

It is hard to get through the hoops and for both operators and patients and conduct IVF services in China.

There's expected to be rising demand in China.

Yes,  Chinese couples do already look overseas.

Article mentioned that between 30-40% of Monash and Virtus' existing patients already come from China.  Potential for this to increase.


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## McLovin (4 December 2015)

Ves said:


> Here's an article you might find interesting.
> 
> http://www.cnbc.com/2015/11/30/end-of-one-child-policy-means-mayhem-in-chinas-ivf-sector.html
> 
> ...




Thanks, mate. The link is dead though.

Edit: Now it works...


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## Ves (4 December 2015)

McLovin said:


> Thanks, mate. The link is dead though.



Sorry,  check the edit.  Didn't copy the first time.


----------



## skc (4 December 2015)

McLovin said:


> I was having a think about the implications for the end of the one child policy. The way wealthy Chinese buy up Australian baby formula got me thinking, will wealthy Chinese couples come to Australia to get their IVF done here because of better regulation etc? I don't know whether the answer is yes or no, just something that I think might have the potential to really benefit guys like MVF.
> 
> Anyone?




Mainland Chinese mothers have been going to HK to give birth there for quite some time, causing a lot of stress on the system and discontent among the locals.

Interesting that there's already a large percent of Chinese IVF tourism. I wouldn't have thought that to be the case, given that Australia is a long way away and not exactly cheap. IVF treatments can be multi-cycle and so can take anywhere from 6 weeks to months and years... so somewhere closer might be easier.

Then again, can't argue with the figures.


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## johnpendles (6 December 2015)

McLovin said:


> , will wealthy Chinese couples come to Australia to get their IVF done here because of better regulation etc?
> 
> Anyone?




No they won't. IVF services in China are of a high quality, although supply for services will be tight in the short term. No need at all to come here.


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## johnpendles (6 December 2015)

Ves said:


> Article mentioned that between 30-40% of Monash and Virtus' existing patients already come from China.  Potential for this to increase.




It said that 30-40% of patients going to Superior A.R.T in Thailand are from China.


With no one child policy, demand for IVF services will certainly ramp up for China. I am not sure that will translate to a significant number of people coming to Australia for treatment though.


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## DeepState (6 December 2015)

johnpendles said:


> nice pop today
> 
> DS what did u make of earnings report?




Apologies for the delay in response, especially given how very helpful your experience has been.  Have not reviewed in detail. Initial observations on surface read:

Market pleasantly surprised by evidence of reversion to long term ARS growth rate. Has been tracking unreasonably low since IPO.
Clearly responding positively to expectations for FY16 reported NPAT to be +25% although revisions to expectations did not come though. FactSet is tracking 6 analysts.  One revised up, one down and average didn't do anything.  Analysts are not giving credence to the stated outlook.  Possible upside surprise and credibility restoration if the target can be hit.

There are significant margin pressures in KL.
Low intervention is lower margin off lower revenue.  Will eventually bite into main line offering.  What rate of revenue and EBITDA compression will occur?
Beginning to grow further away from core IVF by moving to complementary services (day care hospitals, SUFW) and having to engage in pre-emptive self cannibalisation (Bump, MyIVF).  
Fair chunk of headline growth is via acquisition.  Need to check pricing achieved and hence price for growth.
Suspect that increasing supply of IVF specialists offers upside via increasing share of revenue retained.

Lots of questions unanswered at this time. Just first impressions.


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## Ves (7 December 2015)

johnpendles said:


> It said that 30-40% of patients going to Superior A.R.T in Thailand are from China.



Thanks for that,  after reading it a second time it looks like you might be right.   The sentence structure itself is a bit misleading, and they could probably do with a full stop and a separate sentence.


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## McLovin (7 December 2015)

Interesting article, Ves.




johnpendles said:


> No they won't. IVF services in China are of a high quality, although supply for services will be tight in the short term. No need at all to come here.




So why do couples go overseas now? The article infers that aside from gender selection/surrogacy, it's a the regulations that apply in China. Do you have any idea of the breakdown of Chinese couples going overseas for IVF currently? TIA.


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## johnpendles (7 December 2015)

McLovin said:


> Interesting article, Ves.
> 
> 
> So why do couples go overseas now?





Im not sure why couples would leave China to seek treatment in another country. I'm not familiar with their regulations. But for 30-40% of patients of a Thai clinic to be traveling Chinese seeking treatment, there must be something going on. 

My guess is gender selection.


There is no doubt that IVF services will see a huge increase in demand in China. The question for me is not if patients from China will come to Australia, but will MVF look to expand their operations into China?


----------



## johnpendles (7 December 2015)

DeepState said:


> Apologies for the delay in response, especially given how very helpful your experience has been.  Have not reviewed in detail. Initial observations on surface read:
> 
> Market pleasantly surprised by evidence of reversion to long term ARS growth rate. Has been tracking unreasonably low since IPO.
> Clearly responding positively to expectations for FY16 reported NPAT to be +25% although revisions to expectations did not come though. FactSet is tracking 6 analysts.  One revised up, one down and average didn't do anything.  Analysts are not giving credence to the stated outlook.  Possible upside surprise and credibility restoration if the target can be hit.
> ...





Cheers


----------



## pixel (8 June 2016)

I was wondering how the Market would react on the accusations in a recent 4 Corners broadcast:
http://www.abc.net.au/news/2016-05-...ients-about-success-rates-experts-say/7457750

If anything, the debate may have acted as support, as evidenced by the reversal Doji on 1st of June. And the resulting text book rise gave us a new multi-year High.





Waiting for a pullback towards break level, to provide a buying opportunity.


----------



## piggybank (10 August 2016)

pixel said:


> I was wondering how the Market would react on the accusations in a recent 4 Corners broadcast:
> http://www.abc.net.au/news/2016-05-...ients-about-success-rates-experts-say/7457750
> 
> If anything, the debate may have acted as support, as evidenced by the reversal Doji on 1st of June. And the resulting text book rise gave us a new multi-year High.
> ...




Hi Pixel,

Did you get in even though it didn't go below the $1.75 mark? Congratulations if you did as it has gone up an extra 20-25% since.


----------



## The Triangle (19 June 2019)

Sold a quarter of what I held today. I’ll pay the tax man! Always felt this was undervalued but it’s shot up too quickly.  If it’s up again this week I’ll probably dump more.   Virtus looking slightly more attractive - might shift it there.


----------



## The Triangle (28 June 2019)

Sold out the final portion today.  MVF was a reasonably good value when it was below $1 - dividend was 6+%  PE was below 15, EV/EBITDA I think was around 7-8 - and for a medical service company those were good numbers.   However, profits have dropped as of late and a 15% increase (guidance) from last year is still below 2 years ago.   I'm happy to go back to the sidelines on this one and see what the EOFY brings.


----------



## The Triangle (22 August 2019)

Dodged a bulllet.  Mvf and vrt smashed this week.  Vrt had poor earnings mvf has just announced a number of victorian clinics are leaving them.   Always beware when SP climbs 50% on nothing!    Cannot believe the FY results are going to be anything good.   I dont feel the industry can support independents plus two corporations paying dividends and debt service


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## peter2 (31 August 2020)

I was going to post my regular weekly/daily charts that show a bullish view on MVF and VRT. However the longer term view shows just how disappointing these two companies have been for shareholders. This disappointment is shown in the monthly chart (left).






The bullish opportunity in the weekly/daily charts is likely to be contained probable resistance near 1.00. Short term, there may be a pop in price which may be traded. 

Unsurprisingly the monthly chart of VRT looks much the same.


----------



## Miner (23 December 2021)

peter2 said:


> I was going to post my regular weekly/daily charts that show a bullish view on MVF and VRT. However the longer term view shows just how disappointing these two companies have been for shareholders. This disappointment is shown in the monthly chart (left).
> 
> View attachment 108433
> 
> ...



Hi @peter2 
would you please run a commentary since your last posting in August 2020?
Thanks


----------



## peter2 (23 December 2021)

Since my last post, *MVF* has slowly gone back to it's pre-Covid high. The price action is looking corrective certainly not impulsive. This indicates that some caution about further highs is warranted. *MVF* was much higher pre-Covid but in Aug 19 five fertility specialists stopped providing their services to *MVF* in order to start their own company (price selloff). 

*MVF* has had a rocky journey post Covid with ongoing litigation. I'm unaware of the current state of this issue. However it just seems that *MVF* goes from one problem to another. This is reflected by the sloppy price action. 

The recent spike in the daily chart was the same day that *VRT* announced news of a possible take-over by a shareholder. Private equity sees value in this industry. The industry was always going to bounce back once the pandemic restrictions lessen. With *VRT* under siege, *MVF* is the only other option. 

If *MVF* management were better this would have bolted along with the other re-opening companies. I remain wary.


----------



## Miner (23 December 2021)

peter2 said:


> Since my last post, *MVF* has slowly gone back to it's pre-Covid high. The price action is looking corrective certainly not impulsive. This indicates that some caution about further highs is warranted. *MVF* was much higher pre-Covid but in Aug 19 five fertility specialists stopped providing their services to *MVF* in order to start their own company (price selloff).
> 
> *MVF* has had a rocky journey post Covid with ongoing litigation. I'm unaware of the current state of this issue. However it just seems that *MVF* goes from one problem to another. This is reflected by the sloppy price action.
> 
> ...



Excellent commentary. 
Thanks Pete.


----------

