Pro Medicus shares rally after renewing contract with US healthcare provider
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More news: Pro Medicus shares paced gains in early trade after the medical imaging software company signed a five-year renewal contract with Allegheny Health Network.
Shares climbed 9.9% to $145 at 10:53am AEST.
RBC Capital Markets analyst Jackson Lee maintains a sector perform view on the stock with a price target of $195, noting the renewal is an incrementally positive win.
He said that the extensions from both TidalHealth and Allegheny are a step forward in debunking the AI disruption narrative, as neither healthcare provider showed signs of a shorter-term contract preference to preserve optionality for potential AI native alternatives.
Pro Medicus renews five-year contract with Allegheny Health Network
The news: Pro Medicus has signed a five-year contract renewal, valued at $28 million, with US-based Allegheny Health Network (AHN) through its US subsidiary Visage Imaging.
The context: The contract renewal includes the addition of Visage 7 Workflow and is projected to add $125 million to Pro Medicus’ total renewals for the financial year.
AHN is a unified network comprising 14 hospitals and more than 200 primary and specialty care practices in more than 300 clinical locations across 29 Pennsylvania counties, New York, Ohio and West Virginia.
What they said: “AHN has now renewed for a third contract term, reflecting the strength of our long-standing partnership and the value our platform continues to deliver across their organisation,” Pro Medicus CEO Sam Hupert said.
The sources: ASX, RBC Capital analyst note
