Australian (ASX) Stock Market Forum

PME - Pro Medicus

Jump to new
System

System

Joined
27 June 2010
Posts
4,147
Reactions
309
Pro Medicus Limited (PME) is a provider of IT solutions and services to the private healthcare industry. The suite of products which previously comprised of practice management, e-health and digital imaging integration products now includes 2-D digital radiology (PACS) and advanced 3-D clinical products plus a range of services centred on the company's product offerings.

http://www.promedicus.com.au
 
A daily P&F update

140423 - PMEs.gif​
 
PME was brought to my attention today by a fellow investor - he bought in around 80c, they hit $8 today on the back of some contract wins. A very impressive business, meets nearly all my key metrics, no debt, well managed, founding owners more than 50% invested, a competitive advantage and great track record of growth.

The missing metric is price! Its way over my calculation for range of IV so it will go in the watchlist for a big market downturn!
 
galumay said:
PME was brought to my attention today by a fellow investor - he bought in around 80c, they hit $8 today on the back of some contract wins. A very impressive business, meets nearly all my key metrics, no debt, well managed, founding owners more than 50% invested, a competitive advantage and great track record of growth.

The missing metric is price! Its way over my calculation for range of IV so it will go in the watchlist for a big market downturn!
Click to expand...

What are your key metrics?
 
InsvestoBoy said:
What are your key metrics?
Click to expand...

as I said, "no debt, well managed, founding owners more than 50% invested, a competitive advantage and great track record of growth."

I also look at a range of other metrics, ROE, ROIC, EV/EBIT, (Fixed assets+Working Capital)/Earnings,
Working Capital requirements, etc. My valuation range looks at a couple of different calculations of cash flow and earnings and then applies them in a DCF formula.

I try to build a picture of the business from the annual reports and then develop a narrative about the business in terms of what it does, any competitive advantage and examples of good management.

I try not to read what anyone else thinks about the business until I have at least had a cursory look at the key metrics and understood the business.
 
Educational post using PME as the example of a short term setup within a larger time frame setup.

Looking at the weekly chart we see that PME is currently in a corrective pattern after an impulsive move up from $5 to $9. We also see that this corrective move hasn't pullback very much at all. Price did touch the 50% PB level which surprised me when I placed the fib tool (not shown).

We anticipate another impulsive move up when this correction is over. So we're looking for signs that it might be done. The weekly chart shows one of my fav bullish bars, an outside reversal bar with high volume (arrowed). That's my wake-up call and I could buy at Monday's open with an iSL at 7.00.
OR I could wait for a smaller sized setup.

Today's intraday daily chart shows that PME may close >8.00 for the first time in 10 weeks. That's a minor BO-NH and triggers a setup with an iSL at 7.60.

pme1807.PNG


I use this technique of finding a setup in a smaller time frame within a larger time frame setup or trend in my forex trading.
 
Nice.
There appears to be some nice accumulation in the pattern/s
Both longer and shorter term.
 
galumay said:
PME was brought to my attention today by a fellow investor - he bought in around 80c, they hit $8 today on the back of some contract wins. A very impressive business, meets nearly all my key metrics, no debt, well managed, founding owners more than 50% invested, a competitive advantage and great track record of growth.

The missing metric is price! Its way over my calculation for range of IV so it will go in the watchlist for a big market downturn!
Click to expand...
Hi Galumay,

What discount to your IV would you need to buy?
 
As usual P2 called this one nicely.

Can be a little whippy and there is the odd stop run by the looks (traded 8.08 on Monday!) however this one looks very healthy with a great looking weekly bar

PME.png
 
Mr Bear said:
Hi Galumay,

What discount to your IV would you need to buy?
Click to expand...

Sorry Mr Bear, I missed your question at the time. I dont have a hard and fast rule, it depends a bit on my strength of conviction, in some cases I will even buy at around my range of IV if I think the business is good enough.

PME is probably a business I would pay up around IV range, but it is multiples above that!
 
PME, one of interest.

I like the look of this for a swing. Entry would be 11.17 with an iSL of 10.82. Again, current market conditions tell me I should be selling into old highs as the likely hood of an extended move through overhead resistance is low. Target here would be 12.22. This gives us reward/risk of 3:1.

Check out the volume from about the end of November. The majority of up day volume outweighs down day volume. This is exactly what we want to see. Low volume, narrower range bars on the pullbacks closing off the low of the day. A good sign.

Happy hunting.

PME.JPG
 
I wish I had bought into this business long ago, its one of those companies that seems to be always more expensive than what is worth, so there is never another opportunity to buy at a discount to value. It is certainly priced for perfection and exponential growth. Good luck to the holders who believed the story from the beginning!
 
galumay said:
I wish I had bought into this business long ago. Good luck to the holders who believed the story from the beginning!
Click to expand...

This is my current return in PME:
Capture.PNG


I've only held it for a few months. It has retractions periodically, if you specifically need that.
 
I thought that I would show a trade that is not doing well for me at the moment and the differences between adding a simple entry criteria that would have prevented this trade from coming up in my scan.

So the original scan used only 1 time frame which indicated upward trend and then a suitable pullback entry. This appeared to be going well but unfortunately an announcement was released which tipped the trade the wrong way and is slowly recovering but this ties up funds for other trades and probably should had been cut earlier in the trade reversal.

New refined version of the system ensures trend is confirmed in 2 time frames which I find logical in a trend following system and this trade would not have been entered.

So a little aha moment for me to share with you.

upload_2019-12-23_1-59-2.png
 
This trade continues to frustrate me as it goes Up and Down Like A Whore's Drawers.

big day today so hopefully this continues and I can make it to the break even point.

upload_2020-1-9_19-50-3.png
 
Top