Monday, May 25, 2009

Stock of the Week: Fisher & Paykel Appliances Ltd

This is the beginning of a new a column. A regular outing, I will pick one stock that may have been in the news - good or bad-or one that simply takes my fancy and recommend that investors might like to take another look at it to see if it fits their investment profile.




The inaugural Stock of the Week pick is Fisher & Paykel Appliances [FPA.NZ]. Long given a good stiff verbal beating by my good self over many years the main reason why I am picking this stock for closer scrutiny is the ability for you short term investors out there for you to make a quick buck rather than the slow and sometimes painful ones that I make.

Yes, yes, yes you could have bought at NZ 37c a few weeks back but the company's future survival wasn't clear at that point.

The stock closed at 66c on Friday and is on a trading halt until this Wednesday 27 May.

It seems there is to be some material news out this Wednesday in regard to the success or otherwise of its capital raising process.

It seems likely that the news is going be that some kind of finance has been found to keep the company going, at least for the short to medium term, with a 200 million rights issue mooted by BusinessDay over the weekend, the main reason given by FPA management for putting a trading halt on today.

There is some life left in this beast yet, how much we cannot be too sure, but there is short to medium term money to be made if one gets in early on positive news after trading is lifted on Wednesday. The short-term money to be made will be on buying quickly on Wednesday and flicking shares off to those who want to participate in the rumoured capital raising (it could actually be a cornerstone shareholder instead of or as well as) or buying quickly and holding medium to longer term hoping that the company can trade its way out of its current financial, revenue and profit troubles.

It is worth a look at and I will be taking a cursory glance at it on the big day to see if I can gain any benefit from it, as I am not against a short term punt myself.

Good luck.


Stock of the Week Series

Reprise 2 : Contact Energy Ltd
Reprise: Contact Energy Ltd
Restaurant Brands
NZ Refining
Ryman Healthcare
Mainfreight Ltd
Fisher & Paykel Healthcare
Xero Ltd
Auckland International Airport
Sky City Entertainment Group
Burger Fuel Worldwide
Michael Hill International
Contact Energy Ltd
The Warehouse Group
Fisher & Paykel Appliances


Fisher & Paykel Appliances @ Share Investor

Fisher & Paykel downgrade continues fine tradition
Fisher & Paykel Appliances looking fair value
Fisher & Paykel: A Tale of Two Companies
Fisher & Paykel Appliances: In a spin over nothing

Discuss FPA @ Share Investor Forum

Download FPA Company Reports

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The Intelligent Investor: The Definitive Book on Value Investing. A Book of Practical Counsel (Revised Edition) by Benjamin Graham
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