Stock of the day: Fisher and Paykel Healthcare
Fisher & Paykel Healthcare reports a 43% increase in net profit to $153.2 million for the first half of 2025, despite stock pressures. Operating revenue rose 18%, with strategic focus maintaining growth post-Covid-19.
(AI video summary)
This video was created on 28 November for IG audiences by ausbiz.
ASX code: FPH
Fisher & Paykel's performance highlights
Fisher & Paykel Healthcare reported a 43% increase in net profit for the first half (H1) of the 2025 financial year, reaching $153.2 million. While, operating revenue rose 18% to $951.2 million. The company reaffirmed its full-year net profit guidance of $320 million to $370 million.
Despite positive results, the stock has faced pressure, though it is up about 52% year-to-date.
Price-to-earnings ratio considerations
The stock's high price-to-earnings (P/E) ratio is a concern for investors. It was at 103 before the announcement, and even a 40% profit increase would only lower it to 60.
Historically, investors like Howard bought when the P/E was 20 to 25. This suggests holding shares rather than buying more at the current valuation.
Market expectations and outlook
The Covid-19 pandemic set high expectations, impacting market reactions. Fisher & Paykel saw increased demand for masks and healthcare equipment during the pandemic. Post-pandemic, the healthcare sector shifted focus, but the company maintained growth through effective cost management.
With its current valuation, analysts have a hold rating.
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