Building up an investment case requires looking at a stock holistically. Today I’ve chosen to put the spotlight on Fisher & Paykel Healthcare Corporation Limited (NZSE:FPH) due to its excellent fundamentals in more than one area. FPH is a financially-healthy company with a strong track record and a excellent future outlook. In the following section, I expand a bit more on these key aspects. For those interested in digger a bit deeper into my commentary, read the full report on Fisher & Paykel Healthcare here.
Flawless balance sheet with solid track record
Over the past few years, FPH has demonstrated a proven ability to generate robust returns of 24.98% Unsurprisingly, FPH surpassed the Medical Equipment industry return of 11.05%, which gives us more confidence of the company’s capacity to drive earnings going forward.
FPH’s strong financial health means that all of its upcoming liability payments are able to be met by its current cash and short-term investment holdings. This indicates that FPH has sufficient cash flows and proper cash management in place, which is an important determinant of the company’s health. FPH seems to have put its debt to good use, generating operating cash levels of 3x total debt in the most recent year. This is also a good indication as to whether debt is properly covered by the company’s cash flows.
For Fisher & Paykel Healthcare, I’ve put together three fundamental aspects you should further research:
- Valuation: What is FPH worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether FPH is currently mispriced by the market.
- Dividend Income vs Capital Gains: Does FPH return gains to shareholders through reinvesting in itself and growing earnings, or redistribute a decent portion of earnings as dividends? Our historical dividend yield visualization quickly tells you what your can expect from FPH as an investment.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of FPH? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.