We continue to cover LSPD and we like its growth profile, but it has struggled with profitability. In our latest report update on LSPD, we downgraded our rating from a B to a B-, due to its challenges in achieving and maintaining profitability.
Conversely, we like the momentum of VHI. It announced the expansion of its UK subsidiary into the Middle East through a strategic partnership with Abu Dhabi Health Data Services (ADHDS), and its overall sales growth rates have been excellent. Profit margins are growing, and free cash flow is quite good. While we feel that LSPD eventually has potential to turnaround, we would be OK with a switch from LSPD to VHI given its recent positive momentum, ability to operate at a profit, and good free cash flows.