Craneware is the market leader in value cycle SaaS provision in the US with a 40% market penetration and the ambition to become ubiquitous in US hospitals. The shackles of Covid disruption, digestion of the Sentry acquisition, and the transitioning of its customers to the fully cloud based Trisus platform, have fallen away and opened up new sales opportunities for the group. While the shares have out-performed strongly, multiples look reasonable compared with peers. We calculate a DCF based fair value of 2,541p, 15% above the current share price which could easily prove conservative on stronger medium term revenue growth. Craneware sits in the sweet spot of the structural transformation underway in the US healthcare market to value-based care which is currently also the hottest area of healthcare SaaS M&A activity.
