F&P Healthcare: Breathing easy

Having just released the best range of masks in the company’s history, Nathan Bell explains why this might not be the time to sell.

Recently I attended Fisher & Paykel Healthcare's analyst day intent on getting up to speed with the company’s latest product range before issuing a Sell recommendation. The current forecast price-earnings ratio (PER) is a lofty 22, and earnings have been unsustainably boosted by currency hedging contracts that expire in a couple of years (see F&P Healthcare: Result 2013 from 23 May 13 (Hold – $2.66)).

The stock has also produced a total return (capital gains plus dividends) of 57% since our original upgrade in F&P Healthcare: An awakening on 11 May 11 (Long Term Buy – $2.19). So having bought low, we should now sell high, right?



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