FPH - Fisher Paykel Healthcare.

[Phaedrus]

Still in an uptrend, and in a nice tidy trend channel.

[modandm]

catalyst - I think your post on the prior page summed things up perfectly and best represent my views on the stock i.e that it is priced for growth but unlikely to be actually growing (at least in the next few years with the strong kiwi).

My feelings are that FPH holders probably are older income orientated investors - as phaderus mentioned - this stock may be best treated as an income stock.

As to the currency - despite the strange patterns re correlation it is clear FPH would benefit from a stronger USD - whether this will eventuate I have my doubts.

Investing in shares as a currency play is a flawed strategy imho.

All said and done I will still wait for the outlook and should it be as you have suggested unload the position.

The trouble with the NZX is there are so few good opportunities these days...

[Catalyst]

FY11 result about as expected, outlook possibly slightly on the downside.

NPAT of $63.9m was slightly below $65-70m Sep 2010 guidance. (Edit: Nov 2010 guidance was $60-$63m so it bet that.)

Outlook for FY12 NPAT is $62m (if NZD/USD avgs 80c) to $76m (if NZD/USD avgs 70c). Just shows the sensitivity FPH has to the NZD/USD.

Can't see FPH doing much this year if x-rate remains close to 80c. Multiples look on the high side...

PE = $3.11 / ($63.9m / 520.5m shares) = 25.3x
EV/EBITDA = ($3.11 x 520.5m shares + $77m net debt) / $117m EBITDA = 14.6x
Gross yield = 12.4c / 311c / 72% = 5.5%

[percy]

Thanks for your update Catalyst. That x-rate makes for a strong head wind, and certainly makes the multiples high.
I was pleased to see the R&D spend increased.I thought the out look was/is positive.I continue to hold, but wonder if money would be better elsewhere?

[modandm]

sold most at 3.05 a little left to go.

Thanks catalyst.

Im a peter lynch fan and focus on story and PEG ratio. The PEG ratio on this is shocking - im out. Leave it to the oldies chasing the yield to suffer the declining shareprice.

No way Im paying 25x earnings for a company that earnings are going backwards...

[Catalyst]

The underlying growth in FPH is actually very good - it's the high NZD/USD that is masking its performance. If the NZD drops to around 70c then FPH's profits start to grow quite nicely. Unfortunately the NZD/USD doesn't look to be heading down to 70c in the short term.

[percy]

Another ratio other than PEG to look at is PE/growth+yield
PE 25.3 growth 20% yield 5.5 PE 25.3 divided by25.5 [growth+yield] =.99 which is under 1. Which I take to be positive.So will hold.

[modandm]

i rate growth as -3% according to Catalysts outlook based on steady xrate at 80c. Based on that the ratios are terrible. Don't forget FPH has hedged alot of exposure at near 80c already so for an average of 70c the xrate would have to decline to 60c or something - IMPOSSIBLE.

Re NZD USD each entitled to own views. But lets just say i see interest rates in NZ rising faster that rates in the US. The RWC, Chch rebuilding, ongoing boom in demand for NZ Dairy/Meat/Wood from China, all bode well for a sharp NZ economic recovery over the next 2 years. IMHO.

Be this the case - NZD could actually rise vs USD.

[winner69]

The underlying growth in FPH is actually very good - it's the high NZD/USD that is masking its performance. If the NZD drops to around 70c then FPH's profits start to grow quite nicely. Unfortunately the NZD/USD doesn't look to be heading down to 70c in the short term.

There USD stated accounts show revenues up US$19m but EBIT only up US$2m and when you take into account financing costs profit before tax is down over US$4.4m

Is this a better way of looking at FPH performance without having to allow for xrate movements?

Not really what you expect of a 'growth' company though

[winner69]

Another ratio other than PEG to look at is PE/growth+yield
PE 25.3 growth 20% yield 5.5 PE 25.3 divided by25.5 [growth+yield] =.99 which is under 1. Which I take to be positive.So will hold.

Wheres that 20% growth come from percy

in FPH lingo Operating revenue in constant currency terms increased 5% for the year, or 6% for our core products.