After trading as high as $24.50 on June 29th, shares of SHL dropped over 15% to post an intra-day low of $20.60 last Thursday.
The company got some good news last week when they won an exclusive contract to provide a pathology laboratory in two of London’s hospitals.
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The contract has a term of 12 years and is expected to contribute over 12 million Sterling in revenue per year.
Looking at the internal momentum indicators, the share price is slightly oversold and has upside potential to the $22.70 area.
We consider SHL a reasonable buy/write stock which offers price appreciation and enhanced cash flow with the derivative overlay strategy.
Sonic Health
