Sonic Healthcare Limited (ASX: SHL) shares have been among the best on the S&P/ ASX200 (ASX: XJO) over the past decade. The radiology and pathology business has grown organically and by overseas acquisition to now boast a market value around $14.3 billion.
According to a November 24 research note out of Goldman Sachs the stock is probably around fair value today at $29.95. Goldman's has a 'neutral' rating and $29.90 12-month share price target on Sonic.
Goldman's is forecasting Sonic will earn $1.23 per share over fiscal 2020 to place it on around 24.4x estimated forward earnings. For fiscal 2021 it's estimating $1.33 in earnings per share to place it on a more palatable 22.5x earnings. However, it's worth remembering this is an estimate out to June 30 2021.
Zooming out a little it's correct to say Sonic Healthcare has a second-to-none long-term track record of earnings and dividend growth amongst large-cap stocks on the local market. As such it looks worth a place towards the top of investors' research lists.
Elsewhere in the healthcare sector Goldman's has a buy rating on CSL Limited (ASX: CSL) and ResMed Inc. (ASX: RMD).
