Fisher & Paykel Healthcare Corporation Limited

This report is an updated version of the report published on the 20 July 2022 at 3:55 PM GMT

Section 1: Company Overview and Fundamentals Insights

1.1 Company Overview

Fisher & Paykel Healthcare Corporation Limited (ASX: FPH) is engaged in manufacturing and designing medical equipment and systems used in chronic respiratory care, surgery, and the treatment of obstructive sleep apnea. The company provides its products across hospital and homecare settings.

1.2 The Key Positives, Negatives, Investment Highlights, and Risks

1.3 Top 10 Shareholders: The top 10 shareholders together form ~31.26% of the total shareholding. Mitsubishi UFJ Financial Group Inc and Pinnacle Investment Management Group Ltd are holding a maximum stake in the company at ~7.25% and ~5.09%, respectively.

1.4 Key Metrics:

During FY22, the company recorded a net margin of 22.4% against 19.4% of the Industry Median. In addition, the Asset Turnover ratio for the financial year stood at 0.80x, compared to 0.45x of the Industry Median.

Section 2: Business Updates and Financial Highlights

2.1 Business Updates:

2.2 Results Highlights of FY22 & Revenue by Region: The revenue from the Asia Pacific region increased by 26% YoY in FY22, while the largest decline comes from the European region (around -26% YoY) and other regions -by 33%. The revenue is further separated into two categories Hospital (declined by -19% YoY) and Homecare (up by 1% YoY).

Section 3: Key Risks and Outlook:

Section 4: Stock Recommendation Summary

4.1 Price Performance and Technical Summary

4.2 Fundamental Valuation

Valuation Methodology: Price/Earnings Per Share Multiple Based Relative Valuation (Illustrative)

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is July 20, 2022. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: In general, it is a level to protect further losses in case of any unfavourable movement in the stock prices.

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