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Medical Australia valued at almost double its current share price by research firm

Medical Australia (ASX: MLA) is the subject of a recent research report which has issued a price target of A$0.038, almost double its current share price of $0.02, due to the company’s strong progress in its goal to become profitable.

An equity research and market intelligence firm has reaffirmed its positive outlook on Medical Australia based on an updated DCF valuation model.

The price target of $0.038 offers an upside potential of 87.7% from the last traded share price of $0.02.

Last year the company entered into several major distribution agreements and supply contracts which is expected to substantially enhance Medical Australia’s financial performance from financial year 2012 onwards.

One of the agreements tipped as significant in the research report was a global supply and manufacturing agreement with Sydney-based animal healthcare company MediVet.

The deal, which was secured in July 2010, launches Medical Australia into the lucrative US$11 billion pet healthcare market in the U.S and is anticipated to generate A$3 million in annualised revenues.