Wednesday, August 10, 2011

Global Market Sell-Off Stocks: Fisher & Paykel Healthcare Ltd

 


Quite frankly, and as I pointed out on Friday, the whole NZX is on sale and while people are losing money people like me are contemplating buying rather than selling. On fundamentals alone there are many NZX stocks that are looking way more attractive than they had been just 3 trading days ago.

Lets look at some specific stocks though and in the second of a new series to coincide with the current stockmarket sell-off, we will look at one of the brightest parts of the Share Investor Portfolio, Fisher & Paykel Healthcare Ltd [FPH.NZX]

The company has indicated net profit after tax to be in the range of NZ$62 million to NZ$76 million for the 2012 full year, and this is either even with the 2011 full year result or up substantially and this big swing is a result of a volatile currency - US/NZ cross rate.

Revenue in US dollars for the 2012 year. will be considerably up on the 2011 year.

During the big sell-off over the last 3 trading days the fundamentals for this stock are of course looking much better.

Lets have a look:

P/E 22.660
EPS $0.102
NTA $0.592
Gross Div Yield 7.581%

Over the last week the share price has dropped from $2.55c to finish trading yesterday at $2.30, which has exacerbated the drop from mid June from around 3 bucks a share. Drops of 10% & 24% respectively. This is back down to levels not seen since January of 2009 (the last Great Global Market Sell-Off (GGMSO))but well off the early 2010 high of $3.60.

Given that the big global market sell-off probably has more legs in it -even though there has been a dead cat bounce this morning on the DOW - investors would be wise to be a little patient before they jump in. There has been historical support at these levels for FPH shares as noted above but the shares traded intra-day at $2.15 before bouncing back on a weaker NZ currency.

Keep a close watch for the desperate sellers, the unpredictability of this market and currency fluctuations means good opportunities for this stock.

If you were considering buying this stock before last weeks implosion, this week the GGMSO means you will be getting it on sale*.

*If you don't like some risk, stay at home and pat the cat instead.

Disc
I own FPH in the
Share Investor Portfolio



Global Market Sell-Off Stocks Series

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c Share Investor 2011