A new contract renewal confirms Morgans' view that Mach7 Technologies' existing eUnity contracts are cum upgrade upon renewal, and the offering presents value at higher prices.

This opinion by the broker follows the announcement of a five-year subscription renewal with major customer Sentara Healthcare for eUnity, which increases annual recurring revenue (ARR) by $1m.

The analysts consider management has a strong ability to push through more normalised (higher) prices. This outcome will potentially accelerate the company's goal of covering its cost base solely with recurring contracts in the next few years, notes the broker.

The Add rating and $1.54 target are unchanged.

Sector: Health Care Equipment & Services.

Target price is $1.54.Current Price is $0.74. Difference: $0.80 - (brackets indicate current price is over target). If M7T meets the Morgans target it will return approximately 52% (excluding dividends, fees and charges - negative figures indicate an expected loss).

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