Market's view on CVS Group
Published on April 2024
- There are concerns over the impact of a CMA investigation potentially affecting company profits, with some stock watchers expecting this to drag on without immediate significant actions.
- The closure of the CMA’s consultation period is noted but not linked directly to today’s sharp market rise.
- Recent cyber incidents are noted, though they are not expected to significantly affect a veterinary business.
- There are concerns about the transparency of pricing in the veterinary sector and potential overcharging, prompting the CMA to likely enforce more transparency rather than drastic measures like disposals or price caps.
- Brexit is seen as complicating the migration process for EU vets, significantly reducing the number from EU countries and causing a shortage in the UK.
- Observations are made on the monopolistic tendencies within the veterinary market, suggesting that larger groups benefit from economies of scale rather than exploiting monopoly power.
- Concerns are raised about market practices where veterinary surgeries may not treat pets registered with a neighboring clinic.
- Comments are made about stock pricing and market reactions given the ongoing CMA review, with expectations that the company will face a challenging period but might recover slowly.
- There is speculation about potential takeover interest from larger US vet groups due to the current low stock prices.