Medica (LON:MGP) is a small cap Healthcare company that ticks a lot of boxes if you’re looking for your next high quality long term hold. Think repeat revenues, strong cash generation, a solid track record of profitable growth, and encouraging underlying market dynamics. There are some concerns, as well – as there are with any other stock – but overall the medium term prospects look good here.
Medica has clearly qualified for other peoples’ screens as well: it made the cut for the 2020 NAPS as a top QM candidate, and it was also in the top 20 picks in our 2020 Stock Picking competition (you can find a list of the top picks in this PDF).
It also qualifies for a screen I recently set up that aims to identify stocks with long term compounding potential. You can read more about the rationale for that screen here but to cut a long story short, it is looking for high margins and returns on capital over multiple years, with a QM Rank of 75 acting as a basic cut off.
Medica Group was established in January 2004. In 2007, Nuffield Health acquired…
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