Which to buy?? AIA FPH MFT THL

[percy]

FPH is a great company.The current PE ratio is under 40 being 39.97....So you are paying nearly 40 years earnings today,and yet the dividend yield at 1.63% leaves nothing left over once you have paid for the Xmas Turkey.
So with thanks to www.traders.com let's compare.
.............................2017................. .....2018...................2019..............2020
FPH eps..................29.5........................3 3......................39..................45.9
FPH eps growth......................11.8%................. .18.2%.................17.6%................averag e growth rate 15.8%
THL eps...................24.6........................ 31.2....................35.1................38.3
THL eps growth.......................26.8%................ ....12.5%................9.1%.................aver age growth rate 16.1%
THL's PE ratio is 17.81 while their dividend yield is 4.38%/
FPH's PE ratio is 39.97 while their dividend yield is 1.63%
THL's market cap is $549,563,262
FPH's market cap is $6,807,577,762
So FPH is 12 times larger than THL's.
I do have concerns over the huge cost of litigation ,which is on going for FPH,and have found smaller companies usually grow more quickly than large companies.
I did sell my FPH shares as their PE ratio was over twice their growth rate.You will note their PE ratio is currently 2.5 times their eps growth rate,while THL's PE is only 1.1 times their growth rate.Should you take into account THL's much higher dividend yield .I think THL is the better investment.

[voltage]

percy, I like your simple and effective analysis of these 2 stocks. Is the relationship between PE and growth rate the best indicator of whether a stock is a buy? Are there sites with all this data?

[percy]

Google Jim Slater Zulu Principle.

It explains eps growth compared to PE and PEG which is PE divided by growth.And yes I use it all the time.Simple, and effective.
Basically if the PE is lower than the growth rate you are safe.
In NZ because a lot of companies pay high dividends you need to alter the PEG ratio to PEGD which is PE divided by growth plus dividend.
www.4-traders.com have the eps figures amongst a lot of very interesting ratios.
The eps growth you work out yourself.ie eps 1o cents 2016 and 15 cents 2017 you can see its eps growth of 50%.

[kiora]

BUT EPS growth inc for FPH,dec for THL,the average doesn't explain the full story
THL in the past inc EPS by acquisition which carries its own risk of execution and increasing debt. FPH increasing EPS through innovation.
FPH a share if you own should 'never' be sold
If don't own always too expensive.Healthcare industry should always be rated lower risk than tourism industry

[Justin]

BUT EPS growth inc for FPH,dec for THL,the average doesn't explain the full story
THL in the past inc EPS by acquisition which carries its own risk of execution and increasing debt. FPH increasing EPS through innovation.
FPH a share if you own should 'never' be sold
If don't own always too expensive.Healthcare industry should always be rated lower risk than tourism industry

hi kiora, why fph' share price dropped so sharply last year, thanks

[RupertBear]

BUT EPS growth inc for FPH,dec for THL,the average doesn't explain the full story
THL in the past inc EPS by acquisition which carries its own risk of execution and increasing debt. FPH increasing EPS through innovation.
FPH a share if you own should 'never' be sold
If don't own always too expensive.Healthcare industry should always be rated lower risk than tourism industry

Totally agree with you that FPH is a good long term HOLD. The second biggest mistake I have made was selling my FPH and watching them go up and up. I ended up buying them back at a higher price DUH! ( First biggest mistake was owning Wynyard shares! ). I will definitely be buying more on any dip.

[iceman]

RB. I think most people agree FPH is a great long never ending hold. But don't kick yourself for having sold out and done something else along the way. Its an important part of investing

[kiora]

hi Justin
B/c Resmid litigation BUT FPH have come out the winners so far.Shows the value of their intellectual property & patents.

[Scooter]

returns since the first post 24 August
Code 24/8 price 4/9 price return
AIA $6.86 $6.66 -0.20 or -2.9%
FPH $11.68 $12.00 +0.32 or +2.7%
MFT $24.65 $24.74 +0.09 or +0.3%
THL $4.63 $4.57 -0.06 or -1.3%

[Justin]

hi Justin
B/c Resmid litigation BUT FPH have come out the winners so far.Shows the value of their intellectual property & patents.

Thanks Kiora, that's the really good entry point which I missed