John Leonard, CFA
Special situations, micro-cap, contrarian, CFA

Medical Facilities Is An Attractive Niche Healthcare Provider

Medical Facilities (OTCPK:MFCSF) is undervalued and is uniquely positioned to benefit from the growing secular demand for healthcare in the U.S. with its high quality specialty facilities in strong niche markets.

Company overview

MFCSF.PK owns a 51%+ interest in five specialty surgical hospitals (SSH) in South Dakota, Oklahoma, and Arkansas as well as a 51% interest in an ambulatory surgery center (ASC) in California.

In May 2011, MFCSF.PK converted from an Income Participating Securities structure to a traditional common share structure. MFCSF.PK pays a majority of its free cash flow to investors in the form of a monthly dividend.

The Black Hills Surgical Hospital (BHSH) located in Rapid City, South Dakota specializes in orthopaedic and neurosurgical procedures.

The...

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