FPH - Fisher Paykel Healthcare.

[Joshuatree]

Sounds like a tonic :cool:BP, thanks. Meanwhile yes you're right hardt re RMD playing the game(because there you can).
PDF (http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01858415)

[macduffy]

Always looked like a good company but always too dear.

Yes, I went for years thinking that about FPH but took the plunge during a couple of their down spells last year - and now well in the black. One of NZ's few genuine growth companies IMO and worth adding to when opportunities arise.

:)

[Joshuatree]

Sounds like a tonic :cool:BP, thanks. Meanwhile yes you're right hardt re RMD playing the game(because there you can).
PDF (http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01858415)

From what I've read FPH have about 9 months breathing space before RMD's litigation kickstarts off agin ; if it actually does.

[macduffy]

Solid result - NPAT increased by 18%.

https://www.nzx.com/companies/FPH/announcements/301467

I hold.

[babymonster]

margin is very good... just the the lawyers are very costly..

[mondograss]

Interesting reading the bit about the patent claims and counter claims. Does seem to me that ResMed are trying it on and not really getting anywhere.

[BlackPeter]

Solid result - NPAT increased by 18%.

https://www.nzx.com/companies/FPH/announcements/301467

I hold.

Yes - steady as she goes. Good improvement, though annual revenue grew slightly less than analyst predictions. Earnings growth as expected, but just imagine they could have booked the $20 m they spent on lawyers as profit as well - this would have been a rocket!

Positive outlook, though somewhat reduced compared to analyst predictions. Allowance for this years lawyers bills?

Increasing dividend, bringing the annual dividend up to 19.25 cents. Well, this is obviously not a dividend stock (with less than 2% dividend return), but still nice.

Discl: hold and hope for less litigious times to come ...

[macduffy]

Macquaries liked the result.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11861446

[Joshuatree]

Looks like an all time high(my chart only goes 10 years) on big vol; and the $NZ been trending up too!.RMD not quite there but close.

[hogiela]

Looks like an all time high(my chart only goes 10 years) on big vol; and the $NZ been trending up too!.RMD not quite there but close.

Hmmm

FPH getting to that level where I might consider selling some ... the stock currently makes up more than 40% of my portfolio and I bought at $4 ... decisions ...

[hardt]

Hmmm

FPH getting to that level where I might consider selling some ... the stock currently makes up more than 40% of my portfolio and I bought at $4 ... decisions ...

Find a triple bagger somewhere else and your portfolio will be balanced...problem solved, you can thank me later.

[BlackPeter]

Hmmm

FPH getting to that level where I might consider selling some ... the stock currently makes up more than 40% of my portfolio and I bought at $4 ... decisions ...

Well, yes - the trajectory looks quite steep. If you look at it from a short term / trading perspective - you might not be the only one thinking about locking in some gains. If you look at it however from an investment perspective ... long term I think they are only at the start of an exciting growth phase.

However - 40% of your portfolio is a lot (not everybody is a couta ;), certainly more than I would feel comfortable with holding in just one stock; Couldn't blame you to use the current run to take some money of the table.

Discl: holding (and looking for an opportunity to buy some more);

[RupertBear]

Hmmm

FPH getting to that level where I might consider selling some ... the stock currently makes up more than 40% of my portfolio and I bought at $4 ... decisions ...
Hmm yes I sold a few recently to lock in some profits and it has just kept going up and up :mellow:. Apart from owning Wynyard my biggest portfolio mistake has been reducing my FPH holdings thinking I will buy in later at a lower price but it rarely goes down far. I am now a long term holder until a black swan swims past. Good luck with your decision :)

[Joshuatree]

Ditto a while back ,regretfully now. A $6 bill mkt cap truly Global company in many international Funds and Index's portfolios. P E in the 40's. I don't know how to "value" it myself, re if its overvalued run to hard etc.

[BlackPeter]

Ditto a while back ,regretfully now. A $6 bill mkt cap truly Global company in many international Funds and Index's portfolios. P E in the 40's. I don't know how to "value" it myself, re if its overvalued run to hard etc.

Actually - if you put their long term growth (around 10%) and their projected earnings (37 cts) into the Graham formula, than a number roughly 7.5% below the current market value pops out. But hey, this was the same situation when I first considered buying them (3 years ago or around $4 per share). At that stage I didn't buy because they looked too dear to me - and this turned out to be a quite expensive "not buying decision" ;).

They are clearly not cheap if you look at the fundamentals, but it might take a long time until they are "cheap", and if this really happens, we might not want them anymore.

In my view is the current price just reflecting the premium you have to pay for a top quality company with consistent growth and (in practical terms) unlimited growth potential ... however, this does not mean that the SP could not retract if the IP dispute turns sour or if Trump does again something particularly stupid ... it happened before.

[tzbang]

I remember not buying when it was $3.60 and wishing I had.. only to repeat again at $4 and $4.50.. and so on and so forth. I think I finally gave up looking backwards and got on around $8. Waiting for a good dip doesn't seem to happen very often with FPH.

[Puriri Pete]

It never hurts to lighten up when you find yourself overweight. I was in that situation with FPH in Oct 2013 so sold 30% which helped me to sleep better at night. For a while anyway. That was at $3.50. I still have the others, have been overweight again for a long time, but they are locked away in the safe and I've thrown away the key.

[Lewylewylewy]

I looked at these and calculated that based on the expectations, it would take a number of years before they returned dividends in line with what I wanted. I then worked out that I'd be better buying other stock, however I did buy in; upon factoring in that they will always be a premium, they are worth owning.

Therefore, I believe that as they approach a significant market segment, and the possibility for growth decreases, the premium will decrease and as the yield grows, there will be less value in holding for a long term holder. This, to me means that eventually you have to profit take with a stock like this. This, of course is many, many, many years away.

I'll be buying on the dips and holding long term, after advice from the secretary that risks are mitigated. I won't be buying willy-nilly just to get in - that's the way to have your money do nothing for a year.

[macduffy]

It never hurts to lighten up when you find yourself overweight. I was in that situation with FPH in Oct 2013 so sold 30% which helped me to sleep better at night. For a while anyway. That was at $3.50. I still have the others, have been overweight again for a long time, but they are locked away in the safe and I've thrown away the key.

Nice one, Pete! Sleeping better at night is FPH's big strength!

;)

[percy]

It never hurts to lighten up when you find yourself overweight. I was in that situation with FPH in Oct 2013 so sold 30% which helped me to sleep better at night. For a while anyway. That was at $3.50. I still have the others, have been overweight again for a long time, but they are locked away in the safe and I've thrown away the key.

It depends what you do with the funds.I have not ended up in the "poor house," since selling out of AIA,FPH,MFT,POT or SCL,as I felt their growth rate was too low compared to their PE ratio.

[BlackPeter]

Hammer formation today. Could be an indicator for the SP bouncing back at the MA 30.

[hardt]

FISHER & PAYKEL HEALTHCARE

FY13A

FY14A

FY15A

FY16A

FY17A

FY18F

FY19F

FY20F

























OPERATING REVENUES GENERATED - NZDm

507.3

568.6

644.0

818.5

869.5

1010.0

1175.0

1300.0



Cost of goods sold as a proportion of product trading revenues

58.00%

54.90%

50.70%

44.90%

44.90%

46.00%

46.00%

46.00%



Corporate costs as a percentage of trading revenues

24.70%

24.90%

23.18%

25.30%

24.10%

25.00%

25.00%

25.00%














OPERATING EBITDA GENERATED - NZDm

87.7

114.8

168.4

244.3

269.9

315.0

370.0

430.0



ADJUSTED NPAT

24.3

37.6

82.0

143.4

160.1

195.0

240.0

275.0



ADJUSTED EARNINGS PER SHARE

4.28cps

6.62cps

14.45cps

25.27cps

28.22cps

34.37cps

42.29cps

48.46cps




Moderate forecast in my opinion and if the market continues with its appreciation towards FPH I could see the below playing out... Can't forecast sentiment.




FPH.NZX - 2016/2021

FY17F

FY18F

FY19F

FY20F



ADJUSTED EARNINGS PER SHARE

28.22cps

34.37cps

42.29cps

48.46cps



SP AT 52WK FORWARD EARNINGS MEAN OF 35

$12.02

$14.80

$16.96

$18.60

[percy]

Just playing around here.
me an is mean.
....................................2016.......... ....2017........2018.........2019........2020
EPS www.4tradwes.com.. .25................29.5..........33.3..........39. 2........46.6
eps.growth................................18%..... ......12.8%.........17.7%.......11.7%...........me an/average.15.5%
EPS......Hardt.................25.27.............2 8.22.........34.37.........42.29......48.46
eps.growt.................................11.67%.. ......21.17%.........23%........14.5%...........me an/average.17.5%
Question.What is a fair PE for a company growing between 15.5% and 17,5%.?
The current PE is 37.5.

[forest]

I would say a lot less then 35. Especially with the looming legal issues.

[winner69]

Just playing around here.
me an is mean.
....................................2016.......... ....2017........2018.........2019........2020
EPS www.4tradwes.com.. .25................29.5..........33.3..........39. 2........46.6
eps.growth................................18%..... ......12.8%.........17.7%.......11.7%...........me an/average.15.5%
EPS......Hardt.................25.27.............2 8.22.........34.37.........42.29......48.46
eps.growt.................................11.67%.. ......21.17%.........23%........14.5%...........me an/average.17.5%
Question.What is a fair PE for a company growing between 15.5% and 17,5%.?
The current PE is 37.5.

About 30 - 35 .....as its always been

[percy]

I would say a lot less then 35. Especially with the looming legal issues.

Agree.
I think we must also remember the current PE is 37.5, which is really thirty seven and a half YEARS current year's earnings.ie nearly 40 years?
Hardt's mean eps growth is 17.5% ,so FPH is trading at present time over twice eps growth.
W69 is correct that FPH has always traded on a PE between 30 and 35.
I would think 50% higher than Hardt's mean 17.5 % eps growth, which would be a PE of 26.25.may be fair or very fair value.
Litigation.Forest mentioned looming legal issues.These are very real and are going to be considerable.Have analysts accounted fully for them?

[forest]

"An estimate of the financial effect cannot be made".

This in relation to litigation.
The financial effect is a total unknown it seems.
The litigation can be potentially profitable for them if they get payed for infringements or it could be very costly if they have to pay.
Something in between is more likely of course but the fact that the company state that it is not possible to make an estimate is a worry.

What we do know that just over $20mil was spent on litigation last FY and this FY FPH expect the same.

But the real cost might not be the $20mil a year spend on litigation or the possible payout, but the distraction those court cases create for management and directors.
So far FPH seem to be able to handle the distraction of litigation alright but will this continue?

[hardt]

"An estimate of the financial effect cannot be made".

This in relation to litigation.
The financial effect is a total unknown it seems.
The litigation can be potentially profitable for them if they get payed for infringements or it could be very costly if they have to pay.
Something in between is more likely of course but the fact that the company state that it is not possible to make an estimate is a worry.

What we do know that just over $20mil was spent on litigation last FY and this FY FPH expect the same.

But the real cost might not be the $20mil a year spend on litigation or the possible payout, but the distraction those court cases create for management and directors.
So far FPH seem to be able to handle the distraction of litigation alright but will this continue?

Hypothetically speaking, let's say they lose the formidable rubber strap patent - which is used to fasten the sleep apnoea mask onto patients big ol' mugs... would this bring any operation of theirs to a grinding halt?

A hell of a lot has to go wrong before arriving at the worst case scenario... probability is subjective of course.

All of the broker reports I can see are mindful of the litigation, but have stated that the case itself will have barely any material impact on the underlying operations moving forward...

The litigation is worth a closer look, but the quants are supportive of a strong long term investment even when accounting for a year or two of larger one off costs...

[forest]

hardt at the last ASM it was mentioned that it is typical of a litigation of this nature to take 10 years to get resolved.
This together with the unknown outcome and longterm distraction and high PE could make FPH a less than ideal investment.

Another way one can look at the litigation is that supplying medical equipment in the US is competing with the big boys and litigation is just a normal part of doing business.

[hardt]

hardt at the last ASM it was mentioned that it is typical of a litigation of this nature to take 10 years to get resolved.
This together with the unknown outcome and longterm distraction and high PE could make FPH a less than ideal investment.

Another way one can look at the litigation is that supplying medical equipment in the US is competing with the big boys and litigation is just a normal part of doing business.

Uncertainty is not enough reason for me to doubt the return on this kind of growth profile.

Sure the sentiment could take a blow, but the material impact would likely be minimal... as we saw the market back in Dec.

The previous lot of litigation thrown out by RMD was kaka, I can always re-evaluate when RMD file their next one.

I have been moderately generous with the litigation costs in the following years...



FISHER & PAYKEL HEALTHCARE
FY17A
FY18F
FY19F
FY20F
CAGR


















OPERATING REVENUES GENERATED - NZDm
869.5
1010.0
1175.0
1300.0
14.35%


LITIGATION COSTS - NZDm
20.0
25.0
30.0
35.0
*


Litigation costs as a percentage of trading revenues
2.30%
2.48%
2.55%
2.69%
*










OPERATING EBITDA GENERATED - NZDm
269.9
310.0
370.0
430.0
16.79%


ADJUSTED NPAT
160.1
195.0
240.0
275.0
19.76%


ADJUSTED EARNINGS PER SHARE
28.22cps
34.37cps
42.29cps
48.46cps
*




The stock has performed well enough so far, watching closely as it runs along.

[kiora]

Litigation going OK.SP up 37% for the yr
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11910204

[weasel]

Litigation going OK.SP up 37% for the yr
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11910204

Am I having a brain freeze, or does this make absolutely no sense:

"
In May, the medical devices maker said it expected operating revenue to be about $1 billion and net profit in a range of $180 million-to-$190m, based on the New Zealand dollar trading at 69 US cents. However, while trading has been in-line with expectations for the first five months of the financial year, the kiwi has been firmer than forecast.

Assuming an exchange rate of approximately 72.5 US cents for the remainder of the year, F&P Healthcare expects operating revenue to approach $1b and net profit to be "in the range" of approximately $180m to $190m dollars, chief executive Lewis Gradon said in speech notes published ahead of the annual general meeting.
"

[kiora]

U've got it figured WSL.Obviously ? NP better than expected?.Some of ER will be hedged.

[BlackPeter]

Am I having a brain freeze, or does this make absolutely no sense:

"
In May, the medical devices maker said it expected operating revenue to be about $1 billion and net profit in a range of $180 million-to-$190m, based on the New Zealand dollar trading at 69 US cents. However, while trading has been in-line with expectations for the first five months of the financial year, the kiwi has been firmer than forecast.

Assuming an exchange rate of approximately 72.5 US cents for the remainder of the year, F&P Healthcare expects operating revenue to approach $1b and net profit to be "in the range" of approximately $180m to $190m dollars, chief executive Lewis Gradon said in speech notes published ahead of the annual general meeting.
"

I think he wants to say that previously they expected revenue of more than $1b (remember, they normally exceed expectations) and now they only expect to come close to $1b. 4-traders turned their May forecast into $1016m ... and are probably now going back to something like $960m ... $980m (just my uninformed guess).

I think other companies wouldn't have bothered with a downgrade ... but FPH prefers to exceed expectations - i.e. their revenue still might come out at or above the 9 Naughties ...

[Zaphod]

I think he wants to say that previously they expected revenue of more than $1b (remember, they normally exceed expectations) and now they only expect to come close to $1b. 4-traders turned their May forecast into $1016m ... and are probably now going back to something like $960m ... $980m (just my uninformed guess).

I think other companies wouldn't have bothered with a downgrade ... but FPH prefers to exceed expectations - i.e. their revenue still might come out at or above the 9 Naughties ...

That's how I took it too, but it certainly could have been phrased a little more clearly.

[BlackPeter]

That's how I took it too, but it certainly could have been phrased a little more clearly.

True. But then - if that's his worst habit ... I am not too worried about the company ;)

[macduffy]

My interpretation is:
Despite a stronger NZD we still expect NPAT to come in between $180-$190m. A lower NZD would have resulted in a better than previously forecast number.
Or am I wrong?

[kiora]

That's my take on it as well McD

[kiora]

Someone likes their ventilators

[percy]

Someone likes their ventilators

Must be love, as they are now paying 41.76 times earnings for their shares,and only receiving a 1.56% dividend yield.??

[kiora]

Life not love??

[percy]

Life not love??

41.76 times earnings = lust.!

[kiora]

Some serious OE fund money with a lot of lust then?
Or funds with a short term view being replaced by funds with a longer term view?
Drivers of future PE
Interest rates staying lower for longer
Litigation outcomes. Resmed not refiled & outcome shortly
Exchange rates
Company performance & expansion
Resmed growth 4 %,market growth 8-10%
Labour affect on R & D policies & exchange rates

What have I missed?

[percy]

,and
Some serious OE fund money with a lot of lust then?
Or funds with a short term view being replaced by funds with a longer term view?
Drivers of future PE
Interest rates staying lower for longer
Litigation outcomes. Resmed not refiled & outcome shortly
Exchange rates
Company performance & expansion
Resmed growth 4 %,market growth 8-10%
Labour affect on R & D policies & exchange rates

What have I missed?

The 1.56% dividend yield,and the fact FPH's PE is now nearer 3 times its growth rate, than 2 times..

[BlackPeter]

,and

The 1.56% dividend yield,and the fact FPH's PE is now nearer 3 times its growth rate, than 2 times..

Correct - FPH looks dear, but it always did. In my books it is in with a forward PE of 34, a backward PE of 70 (shocking) and a CAGR (slightly below) 10. Even if I apply the original Graham formula, this stock looks dear.

Just compared them to one of the truly international health care stocks: Fresenius (German healthcare giant specialising in dialysis equipment and everything related and 25 times larger than FPH) sells currently for a forward PE of 19, a backward PE of 29 and they have a CAGR above 10. Maybe I should shift some more money to Germany ... ;);

On the other hand - nobody makes money by telling the markets that they are stupid. Do hold some FPH (as well as some FRE (DE) and keep monitoring the uptrend ...

[percy]

Thanks for your post BP.
Over the years we all develope our own style of investing.
I have known people who have done very well investing in only booze shares,others only property shares,while others just like shares that are doing well such as FPH,POT,MFT and AIA,without looking at underlying business ratios.Others rely on charts.So no real "silver bullet" to investing.
I try to have a disciplined approach to my major holdings.
1] Must be a growth sector with strong tail winds,such as retirement,health,tourism ,finance.
2] Must have management who talk simply,and do as they say.
3] Must have a strong balance sheet with very positve cash flow.Business must be profitable.
4] Must be paying a dividend,and have the capacity to pay increasing dividends.
5] EPS growth should be about the same or higher than the company's PE ratio.
......[ a ] Should the growth rate be a lot higher than the PE buy more.
......[ b ] Should the growth rate be a lot lower than the PE take care.
......[ c ] Should the PE ratio be twice the growth rate take extreme care.
......[ d ] Should the PE ratio be over twice the growth rate.sell.
This disciplined approach has both made me a lot of money,and saved me losing money.
I will stick with it.

[BlackPeter]

Thanks for your post BP.
Over the years we all develope our own style of investing.
I have known people who have done very well investing in only booze shares,others only property shares,while others just like shares that are doing well such as FPH,POT,MFT and AIA,without looking at underlying business ratios.Others rely on charts.So no real "silver bullet" to investing.
I try to have a disciplined approach to my major holdings.
1] Must be a growth sector with strong tail winds,such as retirement,health,tourism ,finance.
2] Must have management who talk simply,and do as they say.
3] Must have a strong balance sheet with very positve cash flow.Business must be profitable.
4] Must be paying a dividend,and have the capacity to pay increasing dividends.
5] EPS growth should be about the same or higher than the company's PE ratio.
......[ a ] Should the growth rate be a lot higher than the PE buy more.
......[ b ] Should the growth rate be a lot lower than the PE take care.
......[ c ] Should the PE ratio be twice the growth rate take extreme care.
......[ d ] Should the PE ratio be over twice the growth rate.sell.
This disciplined approach has both made me a lot of money,and saved me losing money.
I will stick with it.

Percy, these are good principles, and actually my strategy is not that different. I just noticed at a recent review of my investment results that I could have done much better by allowing the gains to run instead of selling an upwards trending stock based on fundamental views. FPH is one of these stocks I kept as a result of this review despite it now looking a bit too dear - and so far I can't complain about the outcome.

I see as well the risks in this case as limited - my buy in price is below what I would consider as fair value.

Anyway - you are right, there are many ways to skin a cat ... and I don't think there is a best investment approach either. There are just some approaches which are good enough - and many which are not. I think so far we both seem to be well positioned - despite the odd drawback ;)

[percy]

Percy, these are good principles, and actually my strategy is not that different. I just noticed at a recent review of my investment results that I could have done much better by allowing the gains to run instead of selling an upwards trending stock based on fundamental views. FPH is one of these stocks I kept as a result of this review despite it now looking a bit too dear - and so far I can't complain about the outcome.

I see as well the risks in this case as limited - my buy in price is below what I would consider as fair value.

Anyway - you are right, there are many ways to skin a cat ... and I don't think there is a best investment approach either. There are just some approaches which are good enough - and many which are not. I think so far we both seem to be well positioned - despite the odd drawback ;)

Yes it is always very difficult selling a stock that is in a strong uptrend.And yes the uptrend keeps going up.In FTH's case I sold when they were over $10 before they dropped to nearly $8,then rising up to over $12.So I have missed 20% growth with them,but have more than made that up with the funds elsewhere.
If you recycle funds into a stock where the eps growth rate is higher than its PE ratio, your portfolio should keep out performing.

[moka]

Thanks for your post BP.
Over the years we all develope our own style of investing.
I have known people who have done very well investing in only booze shares,others only property shares,while others just like shares that are doing well such as FPH,POT,MFT and AIA,without looking at underlying business ratios.Others rely on charts.So no real "silver bullet" to investing.
I try to have a disciplined approach to my major holdings.
1] Must be a growth sector with strong tail winds,such as retirement,health,tourism ,finance.
2] Must have management who talk simply,and do as they say.
3] Must have a strong balance sheet with very positve cash flow.Business must be profitable.
4] Must be paying a dividend,and have the capacity to pay increasing dividends.
5] EPS growth should be about the same or higher than the company's PE ratio.
......[ a ] Should the growth rate be a lot higher than the PE buy more.
......[ b ] Should the growth rate be a lot lower than the PE take care.
......[ c ] Should the PE ratio be twice the growth rate take extreme care.
......[ d ] Should the PE ratio be over twice the growth rate.sell.
This disciplined approach has both made me a lot of money,and saved me losing money.
I will stick with it.


Thanks for your post Percy and for "sharing" your investing style (business plan) with other posters and readers on Sharetrader.

I'm reading Van Tharp's book Super Trader at the moment and he says that to be successful you need a business plan with objectives and methodology for your trading/investing.



What is your mission statement? What's the real motivation behind your trading?
What are your goals and objectives?
What are your trading and market beliefs. You cannot trade the market. You can only trade your beliefs about the market. As a result, it's a good idea to identify those beliefs.

The business plan has to suit your personality eg short term trader, long term investor, and level of risk. In other words explore and discover what works for you. And we are all different so there is no one right way to invest or trade.

[kiora]

161 US patents,357 US patents pending

[percy]

161 US patents,357 US patents pending

Should be really profitable earners for lawyers trying to defend that many....

[Zaphod]

Should be really profitable earners for lawyers trying to defend that many....

I'm waiting for the patent trolls to emerge. Surely someone has a submarine patent on part of their technology? Keep an eye on filings in East Texas.... Now, perhaps we should diversify our portfolio's to include legal firms that deal with patents?

[mondograss]

ASX.IPH perhaps?

[voltage]

Percy, great post, do you mind me asking what stocks fall in your criteria, retirement homes, tourism ??

[percy]

NZ..
.........HBL..Heartland Bank.......Finance,Banking
.........OCA..Oceania Healthcare.......Retirement.Should announce maiden divie Feb 2018.
........RYM...Ryman........Retirement
.........SUM..Summerset Group.....Retirement.
..........THL..Tourism Holdings......Tourism
.........TRA. Turners Automotive Group......Finance,Insurance,motor vehicle sales.

AUSSIE.
..........AQZ,Alliance Aviation Services......Tourism,mining services,planes and parts sales.
..........ATL.Apollo Tourism and Leisure......Tourism
..........KKT.Konekt Ltd,.Work place healthcare.....Health
...........LOV..Lovisa..Retail.As an ex retailer I think their business model is the best I have ever seen.Now my largest ASX holding.
...........PGC..Paragon Care......Health and medical supplies.

[Joshuatree]

41.76 times earnings = lust.!

PE 42 .92 now .2nd highest vol in two years, up 22c to $12.83:D
RMD PE 22.5 (ASB adjusted) still off its 2 year high in re april but heading back there. Holding both.

[percy]

PE 42 .92 now .2nd highest vol in two years, up 22c to $12.83:D
RMD PE 22.5 (ASB adjusted) still off its 2 year high in re april but heading back there. Holding both.

You will be looking forward to their PE going over 50...?????
POT must still be great buying as they are on a modest PE of 35.81...
Go for them,,.lol.

[Joshuatree]

Yes our estate still holding this incumbent monster.(POT) Shame you sold @ $4 equiv wasn't it before the5 for 1 split?

[percy]

Yes our estate still holding this incumbent monster.(POT) Shame you sold @ $4 equiv wasn't it before the5 for 1 split?

Certainly was.
And the recycled funds have performed with distinction elsewhere..
ps.pity LOV did not break the $5 barrier today.Another day.?

[kiora]

I am flabbergasted as anyone !
Sometimes best to let the winners run but wondering how far it will pull back when it comes.

[Yoda]

Correct - FPH looks dear, but it always did. In my books it is in with a forward PE of 34, a backward PE of 70 (shocking) and a CAGR (slightly below) 10. Even if I apply the original Graham formula, this stock looks dear.

Just compared them to one of the truly international health care stocks: Fresenius (German healthcare giant specialising in dialysis equipment and everything related and 25 times larger than FPH) sells currently for a forward PE of 19, a backward PE of 29 and they have a CAGR above 10. Maybe I should shift some more money to Germany ... ;);

On the other hand - nobody makes money by telling the markets that they are stupid. Do hold some FPH (as well as some FRE (DE) and keep monitoring the uptrend ...

Isnt it harder for massive companies to expand at a fast rate? With FPH being smaller, they have the advantage ,and many companies that have gone on to great heights have had PE of 40 + in the early years. I think this company will just keep on going , with all the ill health,obesity and the rest. We use Fph at our hospital, and everyone loves their technology . Up 400% in 5 yrs, ...let it run

dis. Holding not enough ......

[BlackPeter]

Isnt it harder for massive companies to expand at a fast rate? With FPH being smaller, they have the advantage ,and many companies that have gone on to great heights have had PE of 40 + in the early years. I think this company will just keep on going , with all the ill health,obesity and the rest. We use Fph at our hospital, and everyone loves their technology . Up 400% in 5 yrs, ...let it run

dis. Holding not enough ......

good point. FPH looks big if compared to other NZ companies, but internationally they are still a mignon with huge growth potential.

[kiora]

OE buyers from BOA Merrill Lynch conference probably happy to buy for long term
https://www.fphcare.co.nz/our-company/investor/presentations/

[hardt]

If anyone was wondering about the down day - UBS downgraded to Sell
( based on valuations and not a material event )... $11.35 PT

[kiora]

If anyone was wondering about the down day - UBS downgraded to Sell
( based on valuations and not a material event )... $11.35 PT

I'm not surprised,twas a tad overbought in the short term

[mondograss]

ResMed not exactly covering themselves with glory in this patent fight:
https://www.nzx.com/companies/FPH/announcements/307998

[kiora]

ResMed not exactly covering themselves with glory in this patent fight:
https://www.nzx.com/companies/FPH/announcements/307998

All good. That's what the market is saying

[peat]

setting itself up for a fall imho. I might consider a short at 13:30
(based on bearish butterfly formation)

[Cricketfan]

https://www.stuff.co.nz/business/industries/97789258/fisher--paykel-healthcare-now-nzs-most-valuable-company

[winner69]

https://www.stuff.co.nz/business/industries/97789258/fisher--paykel-healthcare-now-nzs-most-valuable-company

Good stuff eh

[Joshuatree]

Our weaker $ atm has helped this.Latest on the German infringements in favour of Resmed
Update on Fisher & Paykel patent litigation (https://hotcopper.com.au/threads/3741096/). I own both.

[peat]

setting itself up for a fall imho. I might consider a short at 13:30
(based on bearish butterfly formation)
shame I didnt take this ..... but it never hit the 127% fib
target would have been 11:96

[kiora]

Our weaker $ atm has helped this.Latest on the German infringements in favour of Resmed
Update on Fisher & Paykel patent litigation (https://hotcopper.com.au/threads/3741096/). I own both.

Interpretation really depends on which sides story is read
https://www.nzx.com/companies/FPH/announcements/308666

[Zaphod]

Interpretation really depends on which sides story is read
https://www.nzx.com/companies/FPH/announcements/308666

IMO neither FPH nor Resmed are winning at the moment, it's the lawyers who are.

[kiora]

What is there not to like
https://www.nzx.com/companies/FPH/announcements/308723

[kiora]

Maybe this is why the SP staying up there ?
"One of the FARX's may also be about to get a major boost.

There is talk that Fisher & Paykel Healthcare may be included in the next review of the MSCI global index in November.

If it is included in the index the investment funds who track the index will take up a stake in the company."

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11934539

[kiora]

Strewth .ETF's buying early???

[Joshuatree]

FPH also on Craigs (and prob other brokers lists too) potential winners research note out today may have helped

[kiora]

FPH also on Craigs (and prob other brokers lists too) potential winners research note out today may have helped

But only due to lower $,not from inc health spending?

[Joshuatree]

Yes just that.
Caregivers/retirement props featured in 4 sectors 3 were negative one positive.

[percy]

Share price $13.34.
Price earnings ratio[PE] 44.53
Yield 1.46%.

[peat]

Share price $13.34.
Price earnings ratio[PE] 44.53
Yield 1.46%.

wow.

Fully Priced Huh

[percy]

wow.

Fully Priced Huh

Wonder if it will get to a PE of 50 .?
Must be a bargain,with the yield over 1%.!!!..................lol.

[RupertBear]

It seems to be a share people just keep on buying no matter how much it costs! I sold out recently thinking it was due for a correction but no up up and up it went! Seems to be a hold and never sell share! I will buy back in if it goes down...sometime

[RTM]

It seems to be a share people just keep on buying no matter how much it costs! I sold out recently thinking it was due for a correction but no up up and up it went! Seems to be a hold and never sell share! I will buy back in if it goes down...sometime

My wife did some training work for them about 10 years ago. She has been telling me to buy them ever since. She also told me to buy Apple. Ouch !

[percy]

My wife did some training work for them about 10 years ago. She has been telling me to buy them ever since. She also told me to buy Apple. Ouch !

Always buy what the wife says.
The trick is to use her money.
Then when they complain the divie is hopeless,agree with them.!..Yes dear,just as well I brought you HBL.!

[Zaphod]

Always buy what the wife says.
The trick is to use her money.
Then when they complain the divie is hopeless,agree with them.!..Yes dear,just as well I brought you HBL.!

Now, that is a brilliant strategic move! Well done!

[Jonboyz]

One of my biggest regrets was sellling 75% of my FPH holdings about 12 years ago when I thought it was going no where... It did take a few more years until the remainder started moving significantly but are up over 350% from what I bought them at.

[percy]

Now, that is a brilliant strategic move! Well done!

It really works,but you must put them in her name.!
Then the question comes;"why to I get such a small divie from FPH, when I get such a good one from HBL, with the same amount of capital in each."?

[Joshuatree]

Am 430% plus up on this stock. As long as the world keeps getting fatter FPH will keep going up (unfortunately):cool:.

[winner69]

Share price action might be because FPH is a increasing % of the nzx10 and nzx50 and as such index tracking funds need to keep buying more ....and then more etc


Just a thought

[Joshuatree]

Yes and the current exchange rate weakness. Could be good time to sell and buy back on a possible dip but last time i tried this i only actioned the first part and the s/p kept going up.

[Jim]

Am 430% plus up on this stock. As long as the world keeps getting fatter FPH will keep going up (unfortunately):cool:.

I started this thread back in August 2011 and the share price was aroud $2+.I wasn't sure because the share price was going down and down. I have been following and buying the shares since 2004,
bought 2000 shares at $3.02 in 2004,
bought 1500 shares at $3.34 in 2007
bought 1500 shares at $2.73 in 2008
bought 1500 shares at $2.46 in 2011
bought 2000 shares at $2.18 in 2011
bought 2100 shares at $2.10 in 2012
bought 3000 shares at $1.93 in 2012
sold 2000 at $3 42 in 2013
sold 2000 at $5.22 in 2014
Might be time to sell some to take the top off again lol

[hardt]

It really works,but you must put them in her name.!
Then the question comes;"why to I get such a small divie from FPH, when I get such a good one from HBL, with the same amount of capital in each."?

As much as we all love dividends... no dividend can compete with a yearly 30-40% capital appreciation.

[percy]

As much as we all love dividends... no dividend can compete with a yearly 30-40% capital appreciation.

So still great buying while the PE is under 50.?
Maybe a bit over valued with a PE over 70?
Or who cares about a PE.?

[hardt]

So still great buying while the PE is under 50.?
Maybe a bit over valued with a PE over 70?
Or who cares about a PE.?

Not sure a TTM earnings ratio is going to capture what goes into valuing FPH.

Not to say it is not "expensive" relative to the market, but the market is not comprised of just the tier 1 lovables like FPH/ATM/RBD/SML...

Forward PE36-38 for FPH, not a buyer at these prices, but I am certain the premium will remain until the business stops performing.

[Baa_Baa]

So still great buying while the PE is under 50.?
Maybe a bit over valued with a PE over 70?
Or who cares about a PE.?

You have consistently made it clear that PE is an important part of valuing your preferential shares. It's surprising that you would make such a glib statement about "who cares about a PE", which one might therefore construe as a contrary opinion as to the value of the company.

Cryptic comments are generally just confusing and unhelpful, while at the time it might seem obvious, clear and insightful for those in the know. It is in fact imo just an obfuscating noisy interjection that when one chooses to look into the details, hopefully one has the wherewithall to realise it was a thinly veiled joke, or a confusing message to the ill-informed or unknowing.

Sadly few have that ability, so a guru should be imo more careful about the intonation and inference that they confer when making posts on anonymous share trading forums.

[kizame]

As much as we all love dividends... no dividend can compete with a yearly 30-40% capital appreciation.

Exactly, So long as you drop them when the trend changes to the inevitable down,the same people who go on about divvies are usually the same people saying what a wonderful yield they are getting on the way back down.

[percy]

You have consistently made it clear that PE is an important part of valuing your preferential shares. It's surprising that you would make such a glib statement about "who cares about a PE", which one might therefore construe as a contrary opinion as to the value of the company.

Cryptic comments are generally just confusing and unhelpful, while at the time it might seem obvious, clear and insightful for those in the know. It is in fact imo just an obfuscating noisy interjection that when one chooses to look into the details, hopefully one has the wherewithall to realise it was a thinly veiled joke, or a confusing message to the ill-informed or unknowing.

Sadly few have that ability, so a guru should be imo more careful about the intonation and inference that they confer when making posts on anonymous share trading forums.

Yes I take PE into account when looking at stocks.
I try to buy stocks where the eps growth rate is higher than the PE.
So from www.4-traders.com
................2017.........2018.......2019...... ....2020.
eps.............29.5..........32.9.......38.4..... .....45.5.
eps growth rate....11.5%.......16.7%........17.9%...........a verage...15.36.
Therefore I would think a PE of 20 would be high enough to pay.....or just under $6.00.
Paying a pe of 44.53 does not work for me.

[percy]

Exactly, So long as you drop them when the trend changes to the inevitable down,the same people who go on about divvies are usually the same people saying what a wonderful yield they are getting on the way back down.

Share prices follow earnings.
Increasing earnings per share, means companies have the capacity to increase dividends,which again drives the share price.
FPH 1.46% yield does not attract me.

[Brain]

Yes I take PE into account when looking at stocks.
I try to buy stocks where the eps growth rate is higher than the PE.
So from www.4-traders.com (http://www.4-traders.com)
................2017.........2018.......2019...... ....2020.
eps.............29.5..........32.9.......38.4..... .....45.5.
eps growth rate....11.5%.......16.7%........17.9%...........a verage...15.36.
Therefore I would think a PE of 20 would be high enough to pay.....or just under $6.00.
Paying a pe of 44.53 does not work for me.

Percy you are a man of infinite patience. Any body who did not understand your post probably thinks PE means physical education.

[percy]

Percy you are a man of infinite patience. Any body who did not understand your post probably thinks PE means physical education.

Nearly there Brian.....I am PEed.....Pyschologically Exhausted..................lol.

[kiora]

I started this thread back in August 2011 and the share price was aroud $2+.I wasn't sure because the share price was going down and down. I have been following and buying the shares since 2004,
bought 2000 shares at $3.02 in 2004,
bought 1500 shares at $3.34 in 2007
bought 1500 shares at $2.73 in 2008
bought 1500 shares at $2.46 in 2011
bought 2000 shares at $2.18 in 2011
bought 2100 shares at $2.10 in 2012
bought 3000 shares at $1.93 in 2012
sold 2000 at $3 42 in 2013
sold 2000 at $5.22 in 2014
Might be time to sell some to take the top off again lol

Yes interesting,SP flat lined 2007-2013 with a few dips in between before taking off

[Lewylewylewy]

When I was starting out, I fell into the trap of following advice on here, when people were joking. Now I'm less of a noob I make different mistakes instead :-)

Hmm PE of FPH... Yes, seemingly eternally expensive. So far from the market segment size they're aiming for, and always performing well with good growth. This is why they're loved and the PE is so high. If you look at the number of years of investment before you get you're money's worth on dividend growth alone it's ridiculous. If you view them as something to buy to make capital gains on, they're great. Once you make those gains, it's difficult to find a reason to sell and you end up putting then in the bottom draw to be a share that you eventually end up getting you're money back and not using them for the reasons you originally bought them for. You make your really money when you sell these.

For that reason, I think these are a great buy and hold, even at that ridiculous PE. Still can't help feeling like the greater fool on such a PE though.

Side note: my first purchase of these was actually at a loss. I sold them back when I had no patience and didn't understand the investment. I bought high and sold low because I thought I was the greater fool. Fortunately I held a few, which later (actually just last month) paid back my losses on the dumb big sell. I'll be buying more on the lows. In fact, when the tide goes out, these are my first choice.

[kiora]

They do say you never regret buying quality.Which other blue chip NZ share will continue to grow earnings like FPH for "for the foreseeable long term future"
Percy ,it looks like you would never buy a house in Remuera:" because it would take 40 years to pay off your mortgage" as news reports are now saying but lots do.Its the "new norm" until it isn't.

[percy]

They do say you never regret buying quality.Which other blue chip NZ share will continue to grow earnings like FPH for "for the foreseeable long term future"
Percy ,it looks like you would never buy a house in Remuera:" because it would take 40 years to pay off your mortgage" as news reports are now saying but lots do.Its the "new norm" until it isn't.

Don't know about a house in Remuera,I think I would prefer Orewa
I have owned FPH,AIA,MFT,POT and other fine companies in the past,and they were very successful investments for me.I still hold a few EBO.
I look for eps growth.
When eps growth is a lot higher than the PE ratio I buy.
When eps growth is half the PE ratio I get nervous.
When the PE is three times the growth rate I sell down.
I also look for companies paying a reasonable divie,and have the capacity to pay increasing divies.
Works for me.

[kiora]

Don't know about a house in Remuera,I think I would prefer Orewa
I have owned FPH,AIA,MFT,POT and other fine companies in the past,and they were very successful investments for me.I still hold a few EBO.
I look for eps growth.
When eps growth is a lot higher than the PE ratio I buy.
When eps growth is half the PE ratio I get nervous.
When the PE is three times the growth rate I sell down.
I also look for companies paying a reasonable divie,and have the capacity to pay increasing divies.
Works for me.

Makes sense Percy.It works for you Percy as you have been in the market a long time,do your own research and have the feel for the market.
For other investors that don't have the time in the share market & for the market research My thoughts are FPH is a long term hold,put it in the bottom draw.This is with the understanding that the SP might be high now in the short term (maybe hyper elevated due to index buying) but in 10 20 years as FPH sales double every 5 years
& profit does even better than doubling,then SP will follow earnings & in 10-20 years investors will look back & think how well they have done,or their kids will say to their parents,wow you certainly new what you where doing buying those FPH shares:)

[Brain]

In my view putting a share in the bottom draw is a very dangerous practice. The share market is very dynamic and needs to be watched continuously. As has been said many times before the intrinsic value of a share is its dividend return. With a high PE share an investor has to wait many years to justify the price paid. It is hard enough to predict the performance of a company 2 years out let alone 5 , 10 , or 15 years

[kiora]

In my view putting a share in the bottom draw is a very dangerous practice. The share market is very dynamic and needs to be watched continuously. As has been said many times before the intrinsic value of a share is its dividend return. With a high PE share an investor has to wait many years to justify the price paid. It is hard enough to predict the performance of a company 2 years out let alone 5 , 10 , or 15 years

Metaphorically speaking I agree with you Brain.
BUT how often in hind sight,do investors let their emotion/fear cause them to sell something when,in hindsight it was the wrong time to sell.Look at Jim's returns.He looks to have a high conviction for FPH as a company even the the share price did not match his conviction for a long time.Would you be unhappy with the returns he has made?
In saying that FPH in my view is a share that in the long term will produce a higher return than the majority of shares.As Percy says,he has owned POT,AIA etc & he no longer holds.Why? because of their eps growth.So which blue chip NZ share would Percy buy given a choice of S&P NZX 10?

[BlackPeter]

In my view putting a share in the bottom draw is a very dangerous practice. The share market is very dynamic and needs to be watched continuously. As has been said many times before the intrinsic value of a share is its dividend return. With a high PE share an investor has to wait many years to justify the price paid. It is hard enough to predict the performance of a company 2 years out let alone 5 , 10 , or 15 years

Agree with that. While FPH is a large and solid NZ company with significant international market share - on an international platform they are only a small fish. Impossible for anybody to predict whether they will still flourish in 10 or 20 years or whether some of the big fish will eat or squash them by then.

Nokia and IBM used to be giants in their industry. So was Kodak and Xerox. People still communicate and take photos, but how healthy are these giants in their industry these days?

Dangerous to buy a company with a 35 year payback period ... the company might not be anymore around when it is supposed to pay the investor the last installment of its purchase price.

Not sure whether I would be as conservative as percy (requesting a PE around 20), but above 25 (with a CAGR of 10) this moves as well in my view into a very speculative investment - unless, of course, investors see a growth rate well beyond what the company is delivering at current (always an option).

I certainly don't expect doom and gloom for FPH, but I could well imagine that the SP moves again on some sort of plateau, as it did before and similar to what RYM (with a better growth rate) is currently doing.

Anyway - it always depends on the alternatives - I guess some people pay $6k for a bitcoin without any earning potential. If that's the alternative than FPH is a great investment no matter how dear the purchase price ...

[macduffy]

FWIW, I agree with percy, a P/E of 45 is, at the very least, flashing amber "caution" signals. But I'll stick with FPH while the trend continues - keep the winners and cull the losers!

[percy]

Metaphorically speaking I agree with you Brain.
BUT how often in hind sight,do investors let their emotion/fear cause them to sell something when,in hindsight it was the wrong time to sell.Look at Jim's returns.He looks to have a high conviction for FPH as a company even the the share price did not match his conviction for a long time.Would you be unhappy with the returns he has made?
In saying that FPH in my view is a share that in the long term will produce a higher return than the majority of shares.As Percy says,he has owned POT,AIA etc & he no longer holds.Why? because of their eps growth.So which blue chip NZ share would Percy buy given a choice of S&P NZX 10?

To get around hindsight I use foresight.
eps growth higher than PE, buy.
eps growth half PE, take care.
PE 3 times PE, sell.
Why did I sell POT.Today is the same as the time I sold .Projected.eps growth 10%.PE 36.46.
AIA eps growth 3.4%.PE22.44.
The NZX 10 is made up of ATM,FPH,RYM,CEN,AIA,FBU,SPK,MEL,ZEL,and XRO.I would not buy any of them,however I hold RYM [free ones] and MEL.MEL are my power supplier.I brought at issue,and hold in the hope the divies will pay my power bills.Don't feel so bad every time I switch on the power switch..

[kiora]

To get around hindsight I use foresight.
eps growth higher than PE, buy.
eps growth half PE, take care.
PE 3 times PE, sell.
Why did I sell POT.Today is the same as the time I sold .Projected.eps growth 10%.PE 36.46.
AIA eps growth 3.4%.PE22.44.
The NZX 10 is made up of ATM,FPH,RYM,CEN,AIA,FBU,SPK,MEL,ZEL,and XRO.I would not buy any of them,however I hold RYM [free ones] and MEL.MEL are my power supplier.I brought at issue,and hold in the hope the divies will pay my power bills.Don't feel so bad every time I switch on the power switch..

Ok I understand that.What does your foresight show long term ?
It seems like the SM is your hobby. That's great and a lot of us can learn a lot from your posts.
Looking ahead how long will any of us be around?10,15,20 yrs?
Who do we leave it all to and how knowledgeable will they be?
I don't know but I look at parking some of my investments I anticipate will grow over the long term with minimal need to keep a close eye on.

[percy]

Ok I understand that.What does your foresight show long term ?
It seems like the SM is your hobby. That's great and a lot of us can learn a lot from your posts.
Looking ahead how long will any of us be around?10,15,20 yrs?
Who do we leave it all to and how knowledgeable will they be?
I don't know but I look at parking some of my investments I anticipate will grow over the long term with minimal need to keep a close eye on.

To get some ideas go to advance search.In Key words ..Where to invest?.In user name put KW.I am sorry I have not updated it for some time.No one seemed to be interested.I hold very few NZ shares at present,but the ones I do hold I have rather large positions in HBL and TRA.More modest positions in HLG,MEL,RYM,SUM,OCA,and TIL.I sold half my THL,and may sell the balance this week to add to my ATL in Aussie.I hold two very aggressive [specs] in NZ,ALF and a very large position in PAZ on NZ Unlisted market.
In Aussie I hold AQZ,ATL,AZV,DN8,KKT,LOV,PGC,and a good number of smaller positions.

II

[Beagle]

In principle I broadly agree with Percy's viewpoint on this one BUT technically this looks very strong and simply working the 100 day MA over the last few years has given superb results so I can totally understand existing long term holders wanting to stay on board this train until the bend in the end of the trend. When that comes who can say for sure but it does look stretched on the current forward PE and growth rate.
Might pay to shorten up to a 30 day MA and consider reducing when it breaks down through that indicator.
100 day MA looks to be about $11.75 and 30 day MA about $12.70.
Disc: Don't own, always been an expensive stock and probably will be for quite some time but that doesn't automatically suggest market index outperformance from here going forward.

[Baa_Baa]

In principle I broadly agree with Percy's viewpoint on this one BUT technically this looks very strong and simply working the 100 day MA over the last few years has given superb results so I can totally understand existing long term holders wanting to stay on board this train until the bend in the end of the trend. When that comes who can say for sure but it does look stretched on the current forward PE and growth rate.
Might pay to shorten up to a 30 day MA and consider reducing when it breaks down through that indicator.
100 day MA looks to be about $11.75 and 30 day MA about $12.70.
Disc: Don't own, always been an expensive stock and probably will be for quite some time but that doesn't automatically suggest market index outperformance from here going forward.

That strategy seems plausible, but it does place the 'investors' in the position of 'traders' and therefore exposed to tax on gains (unrealised capital and earnings), which subtracted from actual earnings and capital appreciation, one wonders whether it's worth it, trying to game the share price?

Any which way this looks like a fully priced stock (over priced?), which is as vulnerable as many others are to even the slightest change in market sentiment.

[kiora]

Good discussion all and I think all valid strategies.
It is interesting though.what happens in November and beyond if FPH enters MSCI global index.The ownership trend will flow to overseas investors and how many NZ investors will ever own FPH again because it will forever be too expensive.
Maybe top of the list to buy on the next global crash :)

[RupertBear]

To get some ideas go to advance search.In Key words ..Where to invest?.In user name put KW.I am sorry I have not updated it for some time.No one seemed to be interested.I hold very few NZ shares at present,but the ones I do hold I have rather large positions in HBL and TRA.More modest positions in HLG,MEL,RYM,SUM,OCA,and TIL.I sold half my THL,and may sell the balance this week to add to my ATL in Aussie.I hold two very aggressive [specs] in NZ,ALF and a very large position in PAZ on NZ Unlisted market.
In Aussie I hold AQZ,ATL,AZV,DN8,KKT,LOV,PGC,and a good number of smaller positions.

II

I have been following ATL recenty after reading your posts Percy. I respect your well reasearched and reasoned approach. I am currently kicking myself for not buying in before the sp jumped up recently! Not sure whether to buy in now or wait for a wee dip in price :confused: plus the exchange rate isnt great at the moment, hmmm. Plus I sold out of FPH recently because I thought it was overvalued and due for a correction....which hasnt happened...yet....and I have to say I hate not having some in my portfolio! So although it is expensive I am hoping for a wee dip so I can buy some back! ;)

[percy]

I have been following ATL recenty after reading your posts Percy. I respect your well reasearched and reasoned approach. I am currently kicking myself for not buying in before the sp jumped up recently! Not sure whether to buy in now or wait for a wee dip in price :confused: plus the exchange rate isnt great at the moment, hmmm. Plus I sold out of FPH recently because I thought it was overvalued and due for a correction....which hasnt happened...yet....and I have to say I hate not having some in my portfolio! So although it is expensive I am hoping for a wee dip so I can buy some back! ;)
Yes I still think ATL are good buying.

[kiora]

This argument sounds reasonable 'When valuations are above-average, it means you should expect below-average returns. When they’re below-average, you should expect above-average returns'
https://finance.yahoo.com/news/heres-problem-using-cape-predict-market-crashes-133532569.html
Note: FPH isn't on the list
https://finance.yahoo.com/news/goldman-sachs-only-50-stocks-132400816.html

[kiora]

https://www.odt.co.nz/business/fph-poised-grow-innovation-key

[kiora]

Can FPH do better?
https://finance.yahoo.com/news/resmed-rmd-q1-earnings-top-132201771.html

[peat]

Thats a Healthcare Hatrick to you kiora.

The PE is so high that the air has gone thin and I need one of these
9260

[kiora]

Thats a Healthcare Hatrick to you kiora.

The PE is so high that the air has gone thin and I need one of these
9260

Thanks Peat :) At least you have one on hand :)
PS.At least FPH growth doesn't rely on biological systems
http://www.4-traders.com/A2-MILK-COMPANY-LTD-11384022/financials/
http://www.4-traders.com/FISHER-PAYKEL-HEALTHCAR-6492630/financials/

[Joshuatree]

Can FPH do better?
https://finance.yahoo.com/news/resmed-rmd-q1-earnings-top-132201771.html
Both RMD and FPH at 10 year highs:t_up:.What a pair of rarified airs.

[Joshuatree]

Download Document 54.06KB (https://hotcopper.com.au/documentembed?id=uOMxKKzFkiWRTLKhOROKAxjvSDYL4wq0w BHwv%2BV0%2B7FiGug%3D) this round to FPH v RMD

[Jim]

Both RMD and FPH at 10 year highs:t_up:.What a pair of rarified airs.

The share price had gone up to sell territory. Time to take some tops off

[Joshuatree]

Def worth a review.Depends on each persons entry point, strategy etc.
Trouble is last time i did that they just kept on a goin up.
4Traders 1 buy 3 hold 1 underperform 1 sell, mean val $12.08
Offshore rev benefiting with the $NZ -$US exchange rate
My Broker neutral with $12.75 target

[kiora]

The share price had gone up to sell territory. Time to take some tops off

Yes Jim its in rarefied air.Are you suffering from ownership biases?
That said you could easily be right but how often has that been said?

[mondograss]

Strong result out today, somehow I don't see it going down any time soon.

[Oliver Mander]

Pretty much bang on what they signalled at the last announcement though...and share price has gone up plenty since then. Will it be enough?

[hardt]

Don't think it is enough to keep it from the red today.

disc: holding

[Oliver Mander]

Don't think it is enough to keep it from the red today.

disc: holding

agree. pre-opening already showing some downward movement.
lots of expectation int he price, yet FY outlook looks like no change...

also holding.

[mondograss]

agree. pre-opening already showing some downward movement.
lots of expectation int he price, yet FY outlook looks like no change...

also holding.

Right now, one seller getting rid of 40 shares, one getting rid of 500. Not exactly a run for the door compared to the 185,000 odd shares that traded internationally this morning for just below yesterdays close.

[Oliver Mander]

Right now, one seller getting rid of 40 shares, one getting rid of 500. Not exactly a run for the door compared to the 185,000 odd shares that traded internationally this morning for just below yesterdays close.

good point mondo, shoulda checked the volumes.
Still...not sure how it will go.

[Joshuatree]

Down just a tad. Great outlook,$1 billion rev here we come. Havnt got a bar chart but last i looked every year the chart has marched higher for a long time. A year without litigation costs would be a boost:D as well as 1 where they dropped their R&D to 9% of revenue. Any other stocks on the NZX as reliable and predictable as the growth of FPH?

[kiora]

Down just a tad. Great outlook,$1 billion rev here we come. Havnt got a bar chart but last i looked every year the chart has marched higher for a long time. A year without litigation costs would be a boost:D as well as 1 where they dropped their R&D to 9% of revenue. Any other stocks on the NZX as reliable and predictable as the growth of FPH?

Impressive increased margins.I wonder if there will be costs awarded from litigation?

[mondograss]

Impressive increased margins.I wonder if there will be costs awarded from litigation?

It seems that they expect costs awarded from the UK litigation, I expect that they will elsewhere too.

[sonny n share]

Asb morningstar has a valuation of $10.50. Are their valuations good predictions of future share price ?

[Joshuatree]

No but FPH has been above most brokers valuations for years.

[Lewylewylewy]

Morning star is a very reliable tool. You basically see what it says, then do the opposite. This may seem facetious, but I'm actually (kinda) serious.

I was not surprised by the result today, but was a little by the reaction. I guess FPH is driven by success + greater fool. Unfortunately if you want in, you have to be some kind of fool.

Disclaimer: holding and happy to be more of a fool in future. Safe, reliable, long term, investment.

[percy]

Growth rate 4%..?
PE 43.7 or nearly 11 times their growth rate.?
Yield 1.47%....?

[hardt]

Growth rate 4%..?
PE 43.7 or nearly 11 times their growth rate.?
Yield 1.47%....?

1H delivered as expected though... 2H expected to bring in 100-115m NPAT

15-20% cagr which FPH have been delivering consistently and are expected to deliver consistently into the future...

But yes, it aint cheap...

[Lewylewylewy]

People knew what the guidance was, they hit the guidance and went down.

Therefore either people thought it would be way above the guidance, or weren't listening to the guidance and panicked (probably greater fool scenario), or we are seeing a turning point at which there's a correction occurring. Could be any of the three, in my opinion. Had I not recently doubled down, I would be very happy for it to be the latter 2 options. Maybe I just chalk my recent purchase up as a bad call and use the buying opportunity for my cash savings. I still like this share, it's just that they're eternally overpriced, only a greater fool or a long term investor (or a short term investor playing on the former) can afford them.

Feel like there may be further to fall here or a bounce back. I think I'll hold back from buying more unless they drop significantly, that way I won't feel bad about my recent losses. These are still a nice share to have and keep forever (unless some unforeseen terrible thing happens, as it can with any company), I think.

[macduffy]

I doubt that it's a case of the "greater fool". More likely that the "failure" to exceed guidance caused sober reflection on previous expectations and prompted a bit of profit-taking. Percy has it right - see above.

I continue to hold a few but won't be adding at these levels.

[RTM]

My wife did some work there about 10 years ago. She said at the time I should buy some shares as they were a great innovative company who seemed to look after their staff.. I said no, dividend to low, PE to high etc etc. She does remind me about her recommendation from time to time. As well as Apple. Just wait and I’m sure you will be fine. As I am with Serko....now.
Good luck, cheers, RTM.

[Joshuatree]

The share price had gone up to sell territory. Time to take some tops off
Did you action that good idea Jim?

[trader_jackson]

Growth rate 4%..?
PE 43.7 or nearly 11 times their growth rate.?
Yield 1.47%....?

Pretty highly valued, but at least today it is nearly 10% cheaper than a couple days ago (namely 20th November)

Still the biggest company in NZ I think? In the $7b club... surely that's worth something

[percy]

Pretty highly valued, but at least today it is nearly 10% cheaper than a couple days ago (namely 20th November)

Still the biggest company in NZ I think? In the $7b club... surely that's worth something
Thanks www.4-traders.com
FPH eps 30.22cents.eps growth this year 11.5%, next year 16.7% ave 14.1% .eps 30.22cents times twice eps growth [14.1%] ie 28.2 = sp $8,52 compared to current sp $12.62.
A lot of something built into the current sp.?

[kiora]

Wooow 42 m shares traded today??? What is that.Some one been putting the squeeze on index buyers?

[777]

Wooow 42 m shares traded today??? What is that.Some one been putting the squeeze on index buyers?

As with many stocks in the last 15minutes. Month end.

[Joshuatree]

Wooow 42 m shares traded today??? What is that.Some one been putting the squeeze on index buyers?

Whoa! $709 million worth! Looks to be biggest vol in at least 10 years with nearly 10 % , (54,118,108 shares) of the company traded. Announcement tomorrow i would think.

[hardt]

4:44:59 pm
4:59:47 pm
1310
37,123,431
1
$486,316,946
340





HSBC Custody Nominees (Australia) Limited
44,358,208
7.81%


HSBC Nominees (New Zealand) Limited
36,395,477
6.41%


JP Morgan Chase Bank
34,426,511
6.06%


JP Morgan Nominees Australia
30,209,494
5.32%



Who could it be ?

[777]

Total from NZX today $1,487,495,229

So FPH was 47% plus

[Joshuatree]

Looks like the bulk of them went through at $13.10 very little discount for such a massive vol.

[Joshuatree]

From NBR.FPH has entered a key MSCI index so ETF's etc have to buy . Contact has left hence the $410 million sale of their shares.

[kiora]

FPH share price has been indicating this for a while?
https://www.nbr.co.nz/article/fp-healthcare-extends-patent-fight-vs-resmed-australia-b-211078

[Joshuatree]

its like a never ending boxing match between these two with knockdowns and standups before the 10 count.

[mondograss]

its like a never ending boxing match between these two with knockdowns and standups before the 10 count.

I reckon FPH is ahead on points though.

[kiora]

Looks like it.A knock out for Resmed?

[Joshuatree]

Right at the end of the day a million plus shares go through pushing FPH to a new 1 year high. TGIF.:lol:

[hogie]

Right at the end of the day a million plus shares go through pushing FPH to a new 1 year high. TGIF.:lol:

Dayum I just sold a parcel to rebalance my portfolio ... first sale in 4 years ... oh well

[Jim]

Dayum I just sold a parcel to rebalance my portfolio ... first sale in 4 years ... oh well
I sold some of mine before the HY result to buy my TWR rights entitlement

[Joshuatree]

Ive been caught out before too Jim.This index rebalancing is pretty beneficial at the mo. Then again your tower rights look to more than compensate.

[Joshuatree]

PDF (http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01934718)
The total cost of the building projects in New Zealand and Mexico is expected to be approximately NZ$200M. The new buildings will assist the company to accommodate the strong revenue and people growth anticipated over the coming decade.

"The new building will accommodate expected growth until around 2023" .
Looks like growth momentum a certainty, another reason for the higher PE.

[kiora]

I am unsure what FPH chart indicates

[BlackPeter]

I am unsure what FPH chart indicates

What do you mean? With FPH you need to look at the big picture ... and it is nicely above the MA50 and the MA200 - looks like an ongoing success story to me.

[Onion]

Thank you FPH - the biggest return of my investments this year - 63%.

[kiora]

Good stuff Onion.Next yr litigation outcome good for FPH? SP not worrying,indicating strong outcome?

[Joshuatree]

Here we are again kissing the 60DMA, what is it this time?

[Joshuatree]

This from The BULL weekly share tips (free)
This respiratory care products provider has been on a five year run, but has struggled technically around $13. The market has high growth expectations, with FPH recently trading on an estimated 2018 price/earnings multiple of 42 times. The risk is to the downside, as any slip up will be punished.

[RupertBear]

I am probably wrong and guilty of catching the falling knife but it looks like a good time to buy a wee few ;)

[BlackPeter]

I am probably wrong and guilty of catching the falling knife but it looks like a good time to buy a wee few ;)

Only time can tell - however MA100 and the magical 1300 might be a good enough reason for it to bounce. If you are concerned about the falling knife it might pay to set a narrow cut loss ...

Overall - FPH is expensive (though it always was), i.e. get some misstep from the company and the SP might be severely punished.

Discl: holding (S);

[Leftfield]

Nice result, increased divi too. Congrats to holders.

"Fisher & Paykel Healthcare Corporation Limited today reported record net profit after tax of NZ$190.2 million for the year ended 31 March 2018, an increase of 12% over the previous year. Operating revenue was a record NZ$980.8 million, 10% above the prior year, with 87% of revenue from recurring items, such as consumables and accessories."

(Disc - always liked FPH but don't hold.)

[couta1]

Nice result, increased divi too. Congrats to holders.

"Fisher & Paykel Healthcare Corporation Limited today reported record net profit after tax of NZ$190.2 million for the year ended 31 March 2018, an increase of 12% over the previous year. Operating revenue was a record NZ$980.8 million, 10% above the prior year, with 87% of revenue from recurring items, such as consumables and accessories."

(Disc - always liked FPH but don't hold.)

Market not that impressed and it will be on sale this Thursday.

[Leftfield]

Market not that impressed and it will be on sale this Thursday.

Mmmm TA not looking great either. Interesting to watch from afar.

[BlackPeter]

Nice result, increased divi too. Congrats to holders.

"Fisher & Paykel Healthcare Corporation Limited today reported record net profit after tax of NZ$190.2 million for the year ended 31 March 2018, an increase of 12% over the previous year. Operating revenue was a record NZ$980.8 million, 10% above the prior year, with 87% of revenue from recurring items, such as consumables and accessories."

(Disc - always liked FPH but don't hold.)



Well, I guess there are various ways to read the results - and not all of them would come up with that much excitement. Lets try:

Revenue was 981 m, somewhat lower than analyst consensus (992 m);

Divvie increased, yes - but a payout ratio of 1.6% does not sound outrageous - doesn't it?

EPS- just had to check their current issue counter (given that they seem to issue new shares on a daily basis): 33.3 cents per share based on today's number of shares. Tomorrow it will be less ;); Is this good for a company with a share price north of $13? That's a PE of nearly 40! And yes, they are growing (CAGR stays slightly above 10) - but still - how much is a share with 33.3 cent EPS and 10% CAGR really worth? Good old Graham says below $12 ... and he is typically the optimistic one.

So - yes, FPH is clearly a good solid company with likely a great future. However - they are clearly as well overpriced ... I think I will wait buying back in until the expected PE contraction took place ;).

[Joshuatree]

Yes,outlook for a flat revenue next year and a 10.5% increase in npat suggests a maturing business rather than a growth business which the P E and s/p are priced at.

[Joshuatree]

Ann: FY18 Full Year Investor Presentation (https://hotcopper.com.au/threads/ann-fy18-full-year-investor-presentation.4212091/?post_id=33329577)

[hardt]

Things really picked up in the 2H of this FY, NPAT^20% (21% CC), new product timing etc.

Anything Healthcare related with Consistent, recurring revenues and an ever expanding addressable market is likely to maintain trading at above market ratios...

With revenues at FY19E 1.05bn^7% being around 3-4% below expectations, I don't believe the business is moving through maturation with 10% of revenues funnelled into R&D ( which I expect could grow ) and surgical applications/technologies being on the horizon for 2020 onwards there is plenty of sustainable growth remaining to warrant the current price, will continue to hold but not buying any more.

When R&D declines, then you will see this one maturing... FPH do have a great track record of good returns on R&D investments in new technologies... years and years of consistent 25%+ growth in new applications/tech.

Adding back litigation expenses you would have had ^8.77% NPAT growth over last year which warrants a pullback away from priced in expectations of double digits for the year.

[Beagle]

http://www.4-traders.com/FISHER-PAYKEL-HEALTHCAR-6492630/?type_recherche=rapide&mots=FPH

Priced for perfection but didn't deliver it ?

FY19 PE of 36 and growing EPS at around 10% according to average analyst forecast.

Disc: Don't own and won't pay a PE over 30 for FY19 earnings unless I foresee really high sustainable growth.

[Joshuatree]

16/7/17



FISHER & PAYKEL HEALTHCARE
FY13A
FY14A
FY15A
FY16A
FY17A
FY18F
FY19F
FY20F
























OPERATING REVENUES GENERATED - NZDm
507.3
568.6
644.0
818.5
869.5
1010.0
1175.0
1300.0


Cost of goods sold as a proportion of product trading revenues
58.00%
54.90%
50.70%
44.90%
44.90%
46.00%
46.00%
46.00%


Corporate costs as a percentage of trading revenues
24.70%
24.90%
23.18%
25.30%
24.10%
25.00%
25.00%
25.00%













OPERATING EBITDA GENERATED - NZDm
87.7
114.8
168.4
244.3
269.9
315.0
370.0
430.0


ADJUSTED NPAT
24.3
37.6
82.0
143.4
160.1
195.0
240.0
275.0


ADJUSTED EARNINGS PER SHARE
4.28cps
6.62cps
14.45cps
25.27cps
28.22cps
34.37cps
42.29cps
48.46cps



Moderate forecast in my opinion and if the market continues with its appreciation towards FPH I could see the below playing out... Can't forecast sentiment.




FPH.NZX - 2016/2021
FY17F
FY18F
FY19F
FY20F


ADJUSTED EARNINGS PER SHARE
28.22cps
34.37cps
42.29cps
48.46cps


SP AT 52WK FORWARD EARNINGS MEAN OF 35
$12.02
$14.80
$16.96
$18.60




Just little under your forecast hardt.
4traders consensus, the only change since dec 2017, 1 more analyst added with a buy; sentiment from the rest the same atp.
We have the same conversation each year about it being away overvalued.
Still holding FPH and RMD. The av age and weight of americans for one are looking to increase quite rapidly from here.

[emveha]

Now above 14...

[Joshuatree]

Yes and NZ$ a little stronger against the $US too ?. RMD also nearly A$14 and a new high.

[Joshuatree]

Pretty convincing surge 49c up to $14.40 and 1.8mill shares through,800,000 on the ASX.

[kiora]

Whats with the surge ?

[nzspeak]

Whats with the surge ?

Day by day, people getting fatter, old people getting older, poor countries getting richer. Someone mentioned earlier that it's a maturing business rather than a growth business- I'd bet that person doesn't work in healthcare. Obviously the 50cent gain yesterday wasn't due to demographics but what sort of revenue could FPH be putting up in 20 years? the sky is the limit.

[nzspeak]

It’s a shame FPH isn’t a trendy stock on sharetrader.co.nz, otherwise a lot of users would have made a lot of money. It’s essentially NZ largest external facing company now but it gets no love. Every time it’s mentioned some idiot calls it expensive.

“have halved my holding, while some analysts have now forecast a high target price (nearly $5), this stock has had a very good run, and reflects no downside risk for the currency. Was great buying @ $2.50, now its looking pretty expensive above $4. Trading on almost a 30 P/E” 14-02-2014, 10:08 AM Silverlight.

“Yes agree it is overpriced at this point in time. I've held FPH for 3yrs and it's been a great run up. I've reinvested dividends via DRP, but at these prices, I'm thinking of taking cash over DRP.
I would still like to hold this in case the USD ever comes back up again”


It’s so strange the only posters on the FPH thread continually say it’s overpriced, AND they’re owners! No wonder the thread is always dead. It’s one of the biggest growth stories in the history of the NZX and it’s almost a secret. You can read the whole FPH thread- it’s not very long because it’s one tale after another about how expensive it is. Started at $2.50 now it’s $14.50 took a whole of 5 years.

[Joshuatree]

Dead, dead, dead stay dead, I will give you my shares when you pry them from my cold dead hand:)
I have no posters on ignore and dont intend to.

[JayRiggs]

“Yes agree it is overpriced at this point in time. I've held FPH for 3yrs and it's been a great run up. I've reinvested dividends via DRP, but at these prices, I'm thinking of taking cash over DRP.
I would still like to hold this in case the USD ever comes back up again”

LOL - that's what I said back in 2014! I'm still holding, though I did sell a bit last year to diversify into other stocks.

[winner69]

I sold some FPH for about $18 once ...after doubling in a few months had to sell

Should get back there again one day

[BlackPeter]

It’s a shame FPH isn’t a trendy stock on sharetrader.co.nz, otherwise a lot of users would have made a lot of money. It’s essentially NZ largest external facing company now but it gets no love.

It is not. ATM is larger (at the time of posting this ;)) - and they are as "external facing".


... Every time it’s mentioned some idiot calls it expensive.



Well, I guess this must make me an idiot. I suppose you are an expert in this area?

But lets see ...

FPH has a backward PE of 74.6. This means it would take the company 75 years to earn (based on the average of the last 8 years) its share price.

But sure ... the earnings are modestly rising every year - in the last 8 years they more than doubled from 14 cents per share in 2010 to 33 cents in 2018. Not really stellar, but solid growth.

So lets look at the analyst predictions for the next handful of years. If I use them, than I get a forward PE of 38.4. Still more than 38 years to earn their share price. I call this expensive, but as you say, i must be an idiot.

If we put FPH's forward growth (make it 12%) and earnings into the usually quite optimistic Grahams formula, than we get a fair value per share of $11.84;

So - I guess Graham must have been an idiot as well ... good to know, but don't tell Warren Buffet :p;

Look - I guess what you probably want to say is that market hype is able to override any sensible value proposition (and it is, just look at the "crypto market" - no underlying value, high price). This is however nothing new. Many people buy stocks based on the greater fool theory, and some get rich that way. Does not mean, though that the others are idiots ;):

And just to make myself clear: I think FPH is a great company ... just a bit overpriced - and yes, this can still stay that way for some time (or not).

Discl: used to hold, but am currently not. There are plenty of in my view more sensibly priced companies around which offer appreciation gains as well.

[winner69]

BP - even $11.84 is 32 years ...hmmm

[percy]

BP - even $11.84 is 32 years ...hmmm

Fantastic......32 years.?..
Just before my 102nd birthday.....

[winner69]

In the US growth funds easily beating value funds

Main driver is the current mentality of growth at any price

While the world remains happy as FPH share price will continue upwards (and with expanding PEs)

FPH one of the greatr value creators globally (Boston Consulting Value Creators Report) so FPH well regarded by overseas fund managers

[percy]

In the US growth funds easily beating value funds

Main driver is the current mentality of growth at any price

While the world remains happy as FPH share price will continue upwards (and with expanding PEs)

FPH one of the greatr value creators globally (Boston Consulting Value Creators Report) so FPH well regarded by overseas fund managers

Maybe they are all a lot younger than me.?

[h2so4]

Fantastic......32 years.?..
Just before my 102nd birthday.....

No value there...?.....LOL!

[hardt]

Going to cut my holding by 30% today, had a great run and I hope it continues... I personally don't see anymore than modest gains for the coming year - happy to be proven wrong.
Had a PT of $15 for the FY and that was on slightly better numbers.

Profits already put into riskier picks.

[Filthy]

Comparing FPH to crypto-currency was perhaps a little unfair BP
Without doing the figures, I suspect the high-forward PE is probably there or thereabouts when compared to other similar wide-economic-moat health peers i.e. RMD,COH,CSL
Reckon some of the premium baked-in is also speculative – you never know what that R&D team might create with that 95mill eh.
Good positive balance sheet. I must admit though, I am a little perplexed with the 10% jump since the results which were good, but not fantastic.
Guidance of 210 rather than the 220-230 I had expected. Solid company which I bought on the ‘Mexican wall’ weakness.
Just ‘taken the money and run’ this week, but will be buying-back if/when the price retreats back to my FVE

[Joshuatree]

Filthy are you trading FPH?. If not how to you justify selling now to buy back in later with your accountant or IRD. Genuinely interested in this as ive been having disagreements lately with an accountants.

[BlackPeter]

Comparing FPH to crypto-currency was perhaps a little unfair BP


Sometimes it helps to read a statement in context;); This is what I wrote:



Look - I guess what you probably want to say is that market hype is able to override any sensible value proposition (and it is, just look at the "crypto market" - no underlying value, high price).
...

And just to make myself clear: I think FPH is a great company ... just a bit overpriced - and yes, this can still stay that way for some time (or not).


I did use the crypto market as one example where the price is (driven by hype) above the underlying value of a security. I did not say that FPH is comparable with crypto currencies.

Of course - FPH does have significant underlying value (just lower than the current SP) and they are a great company, while cryto-currencies in my view have no or little underlying value. I never stated anything different;

[Filthy]

hey JT. no I am an investor, rather than a trader.
intent is always to hold long term. just preserving capital on below-par results.
might be months before I get back in - who knows!

looks like there might be some info on this thread which might be helpful-
https://www.sharetrader.co.nz/showthread.php?8887-At-what-point-does-a-Investor-become-a-Trader-from-a-tax-perspective/page3

[Onion]

Just ‘taken the money and run’ this week, but will be buying-back if/when the price retreats back to my FVE

Nice strategy Filthy. I did the same with EBO a few years back (Aug '15). I sold at $11.62 'cos they were getting overvalued and due for a correction :).

The correction should be soon... right?

[RTM]

Nice strategy Filthy. I did the same with EBO a few years back (Aug '15). I sold at $11.62 'cos they were getting overvalued and due for a correction :).

The correction should be soon... right?

Ahhhh....nice, it wasn't just me. I sold at 13.53.....managed to buy them back at 13.54 three months later. Pleased I did...although I did lighten up a bit at 17.80 late last year.

[Filthy]

Nice strategy Filthy. I did the same with EBO a few years back (Aug '15). I sold at $11.62 'cos they were getting overvalued and due for a correction :).

The correction should be soon... right?

yes, the most likely scenario is that the SP will probably rocket now lol, but oh well
we cant get 'em right all the time. lots of fun in trying to take an educated guess though eh!
plenty of other options to allocate the capital too
I hope you made it back into EBO eventually

[Joshuatree]

Sheesh are we there yet$15 here we come a new high and another hex from me:eek2:

[IAK]

Almost - $14.94, changed my $15 sell order, waiting to see how far this goes :t_up:

[Onion]

Almost - $14.94, changed my $15 sell order, waiting to see how far this goes :t_up:

At this price the DRP isn't going to get me many new shares! :t_down:

[Oliver Mander]

"http://www.radionz.co.nz/national/pr...r-13-june-2018 (http://www.radionz.co.nz/national/programmes/businessnews/audio/2018649029/business-news-for-13-june-2018)

Brokers at Forsyth Barr suggest selling ATM, FPH and MFT & taking profits on the record breaking local market."

That's fantastic. As a holder of all 3, and given the significant increases since this interview, I would like ForBar to make a 'sell' recommendation across the rest of my portfolio as well...:t_up:.
I reckon that makes them nearly as successful as Morningstar - ie, whatever they say do the exact opposite...

[BlackPeter]

"http://www.radionz.co.nz/national/pr...r-13-june-2018 (http://www.radionz.co.nz/national/programmes/businessnews/audio/2018649029/business-news-for-13-june-2018)

Brokers at Forsyth Barr suggest selling ATM, FPH and MFT & taking profits on the record breaking local market."

That's fantastic. As a holder of all 3, and given the significant increases since this interview, I would like ForBar to make a 'sell' recommendation across the rest of my portfolio as well...:t_up:.
I reckon that makes them nearly as successful as Morningstar - ie, whatever they say do the exact opposite...

Well, lets face it - FPH looks expensive and MFT at least fully priced. ATM is a different story - hard to assess given that nobody knows the future growth rates.

Wouldn't judge these guys too hard ... they can only assess what they think (right or wrong) is the underlying value of a company. Nobody can predict where the market will drive the price ...

[Oliver Mander]

I agree FPH looks expensive, but on a casflow basis (of the company, not the share), it still stacks up at a 7% discount rate...which is not awful for what is becoming a low-risk company. MFT is at slightly better than that. I don't think there's much upside relative to market, but there's no downside either.

Certainly, I'd still rather be banking on these two internationally diversified companies compared yo the gentailers he was advocating...

[Joshuatree]

Sought after today , 5 million through (re 700,000 on ASX) and at anew high. Flight to quality happening?. A lot of my small caps and microcaps are under the pump atm.

[kiora]

FPH share price has been indicating this for a while?
https://www.nbr.co.nz/article/fp-healthcare-extends-patent-fight-vs-resmed-australia-b-211078

Is this why todays crossings?

[Joshuatree]

An american fund of funds @ 5% plus, 29 mill shareholder ,capital group a keen investor in FPH topping up at a high :). 3.8mill bought a few days ago taken them over 5%.

[Joshuatree]

Forecast to more than double globally

$482.5 Billion Sleep Apnea Oral Appliances Market - Global Forecasts to 2023 - ResearchAndMarkets.comPosted: May 24, 2018 6:25 AM NZSTUpdated: May 24, 2018 6:25 AM NZST

DUBLIN --(BUSINESS WIRE)
The "Sleep Apnea Oral Appliances Market by Product (Mandibular Advancement Devices (Mad) & Tongue-Retaining Devices (TRD)), Type (Physician Prescribed/Customized Oral Appliances & Online OTC Oral Appliances) - Global Forecasts to 2023" (https://www.researchandmarkets.com/research/gfs9kh/482_5_billion?w=4) report has been added to ResearchAndMarkets.com'soffering.
The sleep apnea oral appliances market is projected to reach USD 482.5 million by 2023 from an estimated USD 233.2 million in 2018.
The major influencing factors driving the growth of this market are growing popularity of oral appliances in sleep apnea management, technological advancements in oral appliances, a large pool of undiagnosed sleep apnea patients, and growing awareness about sleep apnea. However, complex referral pathways, coupled with long waiting periods at sleep centers, often acts as a deterrent for the effective diagnosis and treatment of sleep apnea. This is expected to restrain market growth in the forecast period.
On the basis of product, the market is segmented into mandibular advancement devices and tongue-retaining devices. In 2017, the mandibular advancement devices segment commanded the largest share of the global sleep apnea oral appliances market. This segment is also expected to register the highest CAGR from 2018 to 2023. The large share and high growth can be attributed to the popularity of MADs backed up by the extensive research available supporting their effectiveness over TRDs.
Based on type, the sleep apnea oral appliances market is segmented into physician-prescribed/customized oral appliances and online OTC oral appliances. The physician-prescribed/customized oral appliances segment is expected to register the highest CAGR of the sleep apnea oral appliances market during the forecast period. The high growth can be attributed to the rising awareness of sleep apnea and increasing patient preference for prescribed and customized oral appliances.

[emveha]

SP jumps 32.5 c on the day it goes ex-dividend??? I don't understand this stock.

[Joshuatree]

If the above research is reasonably accurate, a possible doubling of revenue in 5 years for FPH is a very attractive low risk fillip for the s/p and great incentive for investors.Track record of increasing earnings continues albeit up a steeper curve?

[emveha]

Yes, FPH printed doubling revenue every 5-6 years as their ambition. They simply won't stop until we're all breathing through tubes!


If the above research is reasonably accurate, a possible doubling of revenue in 5 years for FPH is a very attractive low risk fillip for the s/p and great incentive for investors.Track record of increasing earnings continues albeit up a steeper curve?

The research you quoted seems to be about "mandibular advancement devices" and "tongue-retaining devices", whatever those are. FPH isn't mentioned though.

[Joshuatree]

You're right apologies. heres a bit more re the advantages over cpap below:mad ;:. A friend owns OMH(asx) ,3D printed mouth devices for sleep apnoea. Will have another look, s/p looks to be bottoming. Meanwhile FPH at anew high $15.26!. Who sold a few weeks ago thinking a top was in, incredible isn't it, nuts really.

"The sleep apnea oral appliances market is divided into four major regions—North America, Europe, Asia Pacific, and the Rest of the World. In 2017, North America accounted for the largest share of the global sleep apnea oral appliances market. The rising prevalence of sleep apnea in the region coupled with the growing demand for alternative treatment options due to poor compliance associated with CPAP is driving the market for sleep apnea oral appliances in the region. In addition, rising awareness regarding the disorder; less complicated reimbursement scenario for oral appliance therapy (OAT); and increased acceptance of OAT by physicians, dentists, patients, and insurance companies are also supporting the growth of the sleep apnea oral appliances market in North America. "

[kiora]

Yes I agree its nuts,but if it can double revenue every 5-6 yrs,NP quicker than that, time is your friend :)

[nzspeak]

guess those hicks from silicon valley think its a growth market too https://www.cnbc.com/2018/07/11/alphabet-verily-resmed-to-spin-out-a-start-up-to-address-sleep-apnea.html

[Yoda]

I must say Airvo2 that they have developed in the last 2-3 years is taking the world be storm, and has become a standard of care in most places . Consumables changed regularly at $100 each... Keeping people out of ICU, and the drs and nurses love them for that reason. They just have so many good products . Like inkjet printers, it the consumables that make the money....

[Lewylewylewy]

I sold out a few days ago to reduce my exposure. But fph could come out tops with chinese tariffs, because i believe that's where the competition make their goods.

[Joshuatree]

I must say Airvo2 that they have developed in the last 2-3 years is taking the world be storm, and has become a standard of care in most places . Consumables changed regularly at $100 each... Keeping people out of ICU, and the drs and nurses love them for that reason. They just have so many good products . Like inkjet printers, it the consumables that make the money....

Inside GOLD thanks Yoda. Thats the stuff i love to hear. Compare this incredible highly ranked in the world premium investment , company with that other gollum type penny dreadful "precious" gold company NTL and spot the difference :D..FPH is a long way from being mature imo hence the high PE, high growth channels for sometime yet . But with global mkts getting a bit freaky part of me wants to reduce to protect my capital if a correction happens. The mkt is a weighing machine.DYOR

[nzspeak]

https://www.nzx.com/announcements/322666

another 5% SP rise, another Upgrades Earnings Guidance. Another 3000 posts about AIR NZ. Poor FPH what do they have to do to get some love on the sharetrader forum :(

[Joshuatree]

I love the lack of attention and chatter clatter myself.The less noise the more joy:p

[Patient Panda]

https://www.nzx.com/announcements/322666

another 5% SP rise, another Upgrades Earnings Guidance. Another 3000 posts about AIR NZ. Poor FPH what do they have to do to get some love on the sharetrader forum :(

another one of those high quality companies on very, very high PE.

On a PE of 51 currently!! 51!

meanwhile ATM which is growing over 3x faster is on a PE quoted from NZX of 44.

even comparing it to RYM which has a similar pedigree makes RYM look absolutely dirt cheap.

if theres a correction or rerate FPH will be one of the first in the firing line

[Joshuatree]

See what i mean nzspeak, the noises that missed out:)

[winner69]

Following a strategy of pursuing growth at any cost seems pretty prevalent globally these days. Those doing it don’t seem to be worried about ‘fundamentals’ .....just buy growth is the game....even if that growth is perceived

FPH seems to be one of those stocks .....probably will still go much higher.

[hogie]

Nice AGM today with minimal questions from the forum ... also the food spread was top-notch compared to other AGMs i've been to ... signs that the company is doing well =)

[percy]

Nice AGM today with minimal questions from the forum ... also the food spread was top-notch compared to other AGMs i've been to ... signs that the company is doing well =)

Should they ever serve up crayfish,,,,,,sell.

[BlackPeter]

Nice AGM today with minimal questions from the forum ... also the food spread was top-notch compared to other AGMs i've been to ... signs that the company is doing well =)

The best catering I ever got at an AGM was from a company (TTK) which lost in one year more than 50% of its value. Not saying this will happen with FPH, but I really would not take good catering as a positive indicator!

[Oliver Mander]

OK, I know there's a lot of bullishness around at the moment and that FPH has recently announced a (small) upgrade to the FY19 expectations. But even with that taken into account, there is now a forward PE of 44 on this share.
Am I missing something really obvious?

A great company...but really?

[winner69]

OK, I know there's a lot of bullishness around at the moment and that FPH has recently announced a (small) upgrade to the FY19 expectations. But even with that taken into account, there is now a forward PE of 44 on this share.
Am I missing something really obvious?

A great company...but really?

PEs don’t matter for companies like FPH .....the world is buying quality growth at any cost

That’s what you have missed

[RupertBear]

OK, I know there's a lot of bullishness around at the moment and that FPH has recently announced a (small) upgrade to the FY19 expectations. But even with that taken into account, there is now a forward PE of 44 on this share.
Am I missing something really obvious?

A great company...but really?

Seems like a crazy price atm, I am almost tempted to sell some but when I have done that in the past it just keeps on going up and up ;)

[Blue Skies]

OK, I know there's a lot of bullishness around at the moment and that FPH has recently announced a (small) upgrade to the FY19 expectations. But even with that taken into account, there is now a forward PE of 44 on this share.
Am I missing something really obvious?

A great company...but really?
I wondered if recent surge was due to do with Trump's new free trade deal with Mexico where a lot of FPH components manufactured.

[kiora]

OK, I know there's a lot of bullishness around at the moment and that FPH has recently announced a (small) upgrade to the FY19 expectations. But even with that taken into account, there is now a forward PE of 44 on this share.
Am I missing something really obvious?

A great company...but really?

Potential positives market may be factoring in
- neonatal breathing unit launched (huge market?),overwhelming positive feedback
- exchange rate weakening
-Mexico trade deal
-positive outcome to litigation?
-interest rates lower for longer?
As winner notes everyone is still chasing quality growth,why not as this one is sustainable.It may be expensive now but with forward growth projections,what is it worth?

[Oliver Mander]

Potential positives market may be factoring in
- neonatal breathing unit launched (huge market?),overwhelming positive feedback
- exchange rate weakening
-Mexico trade deal
-positive outcome to litigation?
-interest rates lower for longer?
As winner notes everyone is still chasing quality growth,why not as this one is sustainable.It may be expensive now but with forward growth projections,what is it worth?

Indeed all good points (and I do hold, and have done for some time). Suspect the market must be factoring in additional growth well beyond what has already been disclosed however...

[percy]

The expensive litigation FPH and RMD set to continue.

[Beagle]

PEs don’t matter for companies like FPH .....the world is buying quality growth at any cost

That’s what you have missed

That's true at the minute but what happens if reality bites ?
Quite right Percy, very expensive http://www.sharechat.co.nz/article/bf5b8ae3/f-p-healthcare-warns-of-5-10m-hit-in-contesting-latest-resmed-patent-allegations.html?utm_medium=email&utm_campaign=FP%20Healthcare%20warns%20of%205-10M%20hit%20in%20contesting%20latest%20Resmed%20pa tent%20allegations&utm_content=FP%20Healthcare%20warns%20of%205-10M%20hit%20in%20contesting%20latest%20Resmed%20pa tent%20allegations+CID_d38a12c053d82518cab6e469041 2f6cc&utm_source=Email%20marketing%20software&utm_term=httpwwwsharechatconzarticlebf5b8ae3f-p-healthcare-warns-of-5-10m-hit-in-contesting-latest-resmed-patent-allegationshtml

[RTM]

PEs don’t matter for companies like FPH .....the world is buying quality growth at any cost

That’s what you have missed

This is worth having a look at.....Some of the comments below it are reasonable as well.

https://seekingalpha.com/article/4202954-will-s-and-p-500-valuations-matter

[winner69]

This is worth having a look at.....Some of the comments below it are reasonable as well.

https://seekingalpha.com/article/4202954-will-s-and-p-500-valuations-matter

That view is very bearish isn’t it

[Joshuatree]

UTU!
Fisher & Paykel Healthcare File ITC Patent Infringement Comp 1 page 74.3KB (https://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=02020908)

[Lewylewylewy]

I do wonder about the competition with production in China selling to the usa.

[Onion]

Update on patent proceedings in Germany: https://www.fphcare.com/nz/our-company/investor/news/fy19/germany-patent-proceedings-update/

SP smashed today by over 4%.

They are still putting a positive spin on it:


“While we are disappointed with today’s outcome, this decision will not impact the sale or supply of our current Simplus and Eson 2 masks to our customers in Germany,” said Fisher & Paykel Healthcare Managing Director and CEO, Lewis Gradon. “Furthermore, we continue to anticipate our earlier challenge to the validity of this patent with the EPO.”

Resmed are happy though (http://investors.resmed.com/investor-relations/events-and-presentations/press-releases/press-release-details/2018/ResMed-Wins-German-Patent-Infringement-Case-Against-Fisher--Paykel/default.aspx):


“We applaud the Munich District Court for reaching this just finding, and are exploring all options in light of the fact that Fisher & Paykel is selling CPAP masks with headgear that infringes a valid ResMed patent in Germany,” said ResMed Chief Administrative Officer and Global General Counsel David Pendarvis. “We will continue to defend our intellectual property here and wherever necessary to ensure that patients worldwide continue to receive the high-quality care they deserve,” Pendarvis said."

[BlackPeter]

Anybody remembering the $16.39 per share people have been happy to pay end of August? Down more than 20% (this is the start of bear territory, isn't it? And the trendline just passed the "cross of death" and struggles with moving agains above the MA400. I guess this means for such a well run company that great buying opportunities will be ahead, but at this stage they still feel pretty dear.

Forward PE still close to 33 ... even a CAGR of nearly 16 does not really sweeten this deal.

Any ideas where the trend might turn agin? $12? $11? - or will it go down to the $10?

Fun fact ... even at $10 would the forward PE (3 years avg) still be 25 .. - and lets not talk about the backward PE (10 years avg) ... above 50!

[kiora]

Anybody remembering the $16.39 per share people have been happy to pay end of August? Down more than 20% (this is the start of bear territory, isn't it? And the trendline just passed the "cross of death" and struggles with moving agains above the MA400. I guess this means for such a well run company that great buying opportunities will be ahead, but at this stage they still feel pretty dear.

Forward PE still close to 33 ... even a CAGR of nearly 16 does not really sweeten this deal.

Any ideas where the trend might turn agin? $12? $11? - or will it go down to the $10?

Fun fact ... even at $10 would the forward PE (3 years avg) still be 25 .. - and lets not talk about the backward PE (10 years avg) ... above 50!

Who knows what share price could go down to.I do know that future earnings are highly likely to be far greater than the past earnings have been. That's why takeovers happen & why I HATE most takeovers.They are generally lost opportunities for existing SH.Future share price and any TO price is dependent on where you sit.TO of FP Appliances,Trademe happened when someone saw good value.

[BlackPeter]

Who knows what share price could go down to.I do know that future earnings are highly likely to be far greater than the past earnings have been. That's why takeovers happen & why I HATE most takeovers.They are generally lost opportunities for existing SH.Future share price and any TO price is dependent on where you sit.TO of FP Appliances,Trademe happened when someone saw good value.

Nothing wrong with takeovers - they only can happen if the bidder sees more value in the company than the (overwhelming majority of) sellers, otherwise they just wouldn't sell - would they? As well - just buy into the bidder (normally a listed company as well) and all is sorted ...

Not sure, though whether there are any planned on FPH's account - they honestly don't look that cheap to me, but sure, somebody with deep pockets might be interested in their IP.

[kiora]

Nothing wrong with takeovers - they only can happen if the bidder sees more value in the company than the (overwhelming majority of) sellers, otherwise they just wouldn't sell - would they? As well - just buy into the bidder (normally a listed company as well) and all is sorted ...

Not sure, though whether there are any planned on FPH's account - they honestly don't look that cheap to me, but sure, somebody with deep pockets might be interested in their IP.

I am not sure that this would be the right choice"As well - just buy into the bidder (normally a listed company as well) and all is sorted ..."
A lot can happen following a takeover including diluting earnings growth,debt, company gearing etc
PLUS change the companies philosophy & products.Damn HEINZ baked beans & spaghetti are crap compared to the flavor of the old Watties baked beans & spaghetti.Bring back Watties any day!

[BlackPeter]

I am not sure that this would be the right choice"As well - just buy into the bidder (normally a listed company as well) and all is sorted ..."
A lot can happen following a takeover including diluting earnings growth,debt, company gearing etc
PLUS change the companies philosophy & products.Damn HEINZ baked beans & spaghetti are crap compared to the flavor of the old Watties baked beans & spaghetti.Bring back Watties any day!

So - what are you proposing - ban takeovers to protect baked beans with spaghetti? Or to only allow takeovers if they are a clear disadvantage for the bidder and the act for endangered canned spaghetties is adhered to? Does not make a lot of sense, doesn't it?

Admittedly no expert on tinned baked beans and spaghetti (sounds revolting to me, no matter which can they are sourced from), but if there is a market for this stuff, than what is stopping any newcomer to create a tastier version ... does not sound like brain surgery to me ;); Certainly no reason to stop takeovers ...