Morningstar sees improving profitability for 'undervalued' Integral Diagnostics

** Analysts at Morningstar say shares of Australian medical imaging services provider Integral Diagnostics IDX are "undervalued"

** Morningstar says brokerage is likely more optimistic than the market on profitability improving in longer term

** IDX forecasted FY26 operating EBITDA margin of ~21% inline with Morningstar estimates; Morningstar sees margins to lift to 24% by fiscal 2029

** Morningstar sees margin expansion from higher volumes and improved labour productivity

** Sees co's sales growth being slightly stronger than industry, driven by greater exposure to national lung cancer screening program and MRI imaging

** All 11 analysts covering the stock rate it "buy" or higher; their median PT is A$3.41 – LSEG data

** Stock down 11% this year