SeeThruEquity Initiates Coverage on Medical Transcription Billing, Corp. (NASDAQ: MTBC) with a Price Target of $3.65

NEW YORK, NY / ACCESSWIRE / March 3, 2016 / SeeThruEquity, a leading independent equity research and corporate access firm focused on smallcap and microcap public companies, today announced it has initiated coverage on Medical Transcription Billing, Corp. (NASDAQ: MTBC) with a 12 month price target of $3.65.

The report is available here: MTBC Initiation Report. SeeThruEquity is an approved equity research contributor on Thomson First Call, Capital IQ, FactSet, and Zack’s. The report will be available on these platforms. The firm also contributes its estimates to Thomson Estimates, the leading estimates platform on Wall Street.

Based in Somerset, NJ, MTBC is a healthcare information technology company that provides a fully integrated suite of web-based solutions and related business services to ambulatory healthcare providers. MTBC went public on NASDAQ in July 2014, after several years of strong growth through both acquisitive and organic means as a private healthcare technology company. Through its flagship software-as-a-service (SAAS) platform Practice Pro, MTBC “brings big practice solutions” to over 750 small and medium sized medical practices, helping more than 1,700 providers grow and track sales, streamline operations, and use data to facilitate better business and clinical decision making. We see several catalysts ahead for MTBC as the company recently raised significant new investment capital through a non-convertible preferred stock offering, which should enable it to make strategic investments in growth, fund share buybacks and drive cash flow leverage in 2016 and beyond.

“MTBC has significant opportunity in making acquisitions with 1,500+ companies offering revenue cycle management to healthcare providers in the United States – none of which have more than a 5% share of the market – and more than 700 companies offering EHR technology solutions,” stated Ajay Tandon, CEO of SeeThruEquity. “In our view, these attributes make for an attractive consolidation opportunity. Indeed, MTBC is led by a savvy, deeply experienced management team and Board of Directors, which has completed and integrated 13 acquisitions over the last five years. So far, these efforts have driven rapid top line growth, with revenue rising from $9.2mn in 2010 to $23.0mn in 2015. We expect continued growth for MTBC in 2016 and beyond,” continued Ajay Tandon. “We are initiating coverage with a 12-month price target of $3.65 per share.”

Additional highlights from the report are as follows:

MTBC targeting a large opportunity

We see the potential for strong growth for MTBC as it acts as consolidator in the large and fragmented healthcare IT market. MTBC’s initial focus in on providing a robust software platform for small practices (1-10 providers), which supports online management of Electronic Health Records (EHR), Revenue Cycle Management (RCM) and Practice Management (PM), with Mobile Health (mHealth) solutions, including smartphone applications that assist patients and healthcare providers. The market for US Ambulatory EHR and RCM alone represents a $13Bn annual opportunity, according to management. With competitors such as athenahealth focused on large group practices, we see ample room for MTBC to take share in the more fragmented market servicing small practices. Indeed, MTBC management has noted that 90% of physicians prefer a single-source vendor for EHR, RCM and PM, and 70% of the 500,000 ambulatory physicians in the US are in practices with ten or fewer providers.

Good visibility and high incremental margins promise earnings leverage as MTBC grows

MTBC has attractive per customer economics that combine high visibility with high incremental margins per customer. The company has high renewal rates of over 90% for PracticePro customers, creating a “sticky” offering with as much as 95% revenue visibility heading into each quarter. PracticePro also has attractive economics as a cloud-based solution, which should demonstrate nice operating leverage as MTBC’s scalable platform should support significant customer additions without needing large incremental investments. Even before the economics of scale, however, MTBC benefits from access to a highly educated, low-cost labor force of approximately 1,500 in its operations and support offices in Pakistan. With each acquisition, the company is able to extract value from the cost arbitrage as it transitions roles and expenses from the United States to Pakistan – in addition to the costs eliminated by porting acquired customers over to its PracticePro platform. In our view, these attributes are critical advantages for MTBC as it pursues a consolidation strategy in the industry. Following new acquisitions, management is targeting post-integration EBITDA margins of 30%, with the margin expansion resulting from integration into a highly educated, low cost labor force, while reaping benefits of scale as more customers are serviced by the relatively fixed costs of its cloud-based platform.

Initiate coverage with a price target of $3.65

Our analysis indicates a fair value estimate of $3.65 per share. We view MTBC as an attractive company in the healthcare technology industry that offers exposure to a massive market opportunity at a compelling valuation. If achieved, the price target of $3.65 represents potential upside of 310% from the recent price of $0.89.

Please review important disclosures at www.seethruequity.com.

About Medical Transcription Billing, Corp.

Medical Transcription Billing, Corp. is a healthcare information technology company that provides a fully integrated suite of proprietary web-based solutions, together with related business services, to healthcare providers practicing in ambulatory care settings. The company’s integrated Software-as-a-Service (or SaaS) platform helps our customers increase revenues, streamline workflows and make better business and clinical decisions, while reducing administrative burdens and operating costs. MTBC’s common stock trades on the NASDAQ Capital Market under the ticker symbol “MTBC,” and its Series A Preferred Stock trades on the NASDAQ Capital Market under the ticker symbol “MTBCP.”

www.MTBC.com.

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About SeeThruEquity

SeeThruEquity is an equity research and corporate access firm focused on companies with less than $1 billion in market capitalization. The research is not paid for and is unbiased. The company does not conduct any investment banking or commission based business. SeeThruEquity is approved to contribute its research to Thomson One Analytics (First Call), Capital IQ, FactSet, Zacks, and distribute its research to its database of opt-in investors. The company also contributes its estimates to Thomson Estimates, the leading estimates platform on Wall Street.

For more information visit www.seethruequity.com.

Contact:

Ajay Tandon
SeeThruEquity
info@seethruequity.com

SOURCE: SeeThruEquity

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