Morningstar has down-graded its rating on Fisher & Paykel Healthcare from accumulate to hold on the back of concerns about disappointing performance from healthcare's obstructive sleep apnoea product.

In a note analyst Nachi Moghe said the sleep apnoea business had suffered because of a significant slow-down in sales of consumables such as masks.

"As a result the obstructive sleep apnoea business posted a modest growth in constant currency terms, well below the 10 to 15 per cent growth the business has achieved historically," he said.

Moghe said he believed the lack of new products had affected market share and constrained revenue growth.


Morningstar has lowered its financial year forecast for 2013 from $73 million to $70 million although it is predicting a net profit of $80 million for financial year 2014.

Shares in Fisher & Paykel Healthcare have fallen significantly since its result announcement last Friday despite the company announcing a net profit increase of 22 per cent to $64.1 million.

Before the result the company was trading at $2.45. Shares closed down 7c yesterday at $2.05.


Several market players believe Tower's strategic review will result in a break-up of the company.

The insurance and investment business last week updated investors on its review during its half-year result.

Chairman Bill Falconer first revealed the review in February at the annual meeting and the company has now said it could result in strategic partnerships, complementary merger opportunities, acquisitions, divestments and/or a return of capital.

It has appointed Goldman Sachs to conduct the review.

But there is a strong belief that Tower will split up the business and sell off its assets separately. It has four business arms - general, life and health insurance and wealth management.

The sale of AMI last year attracted several bidders and could mean Tower's general insurance business would also be attractive to a number of buyers.

But chief executive Rob Flannagan says breaking up the business may not be that easy.

"We have got four separate businesses - it's hard to find four buyers at once."

Flannagan said because Tower's share price was trading below its net asset backing there was some belief that splitting it up would get more money for the business

"But that may not be the case."

Flannagan said there was no timeline for the review to be completed."

He said the review was not being driven by Guinness Peat Group which wants to sell its 35 per cent stake in the business.

"The board feels very strongly about doing right by all its shareholders."

Shares in Tower closed down 4c yesterday at $1.59.


Goldman Sachs will be hoping for some sale action from Tower to help boost its balance sheets after its latest result.

The New Zealand arm of the business posted a full-year loss of $3.58 million in the year to December 31 down from a profit of $8.87 million in the previous year.

Its revenue fell from $43.6 million to $22.2 million.

At least if Tower doesn't come off there is always Mighty River Power.

Goldman Sachs is one of three investment bankers appointed to help put together the partial sell-down of the SOE.


Shareholders in Guinness Peat Group are keeping their fingers crossed that the company will commence a share buy-back soon to help boost its share price.

The shares have been drifting ever lower in the last year.

This time last year the shares were trading around 85c. They are now down around 48c.

GPG chairman Rob Campbell indicated a share buy-back was on the cards at the recent annual general meeting.

"We have been working on arrangements to commence a share buyback," Campbell said.

"The board anticipates ... it will seek to undertake an on-market buyback.

"This would be via a programme over the coming year in accordance with the limits, including price restrictions, set out in that resolution," he told shareholders.

"We see this as potentially an ongoing programme as our divestment and cash position allows."

GPG certainly has enough cash to make it happen.

The company is sticking to its strategy to sell down assets but admits it has been slower in the first quarter of 2012 than it had hoped.

Campbell told investors he expected it to pick up in the next two quarters.

But market players aren't expecting Tower to be at the top of its list.

Shares in GPG closed up 0.5c yesterday at 49c.


Shares in logistics company Mainfreight bounced back this week after a stronger than expected result but not all investors are happy with the company's overseas performance.

One source said Mainfreight had yet to prove itself when it comes to getting the most out of its international businesses.

While Mainfreight has boosted the return on its Australasian assets from 17 per cent to 19 per cent its international assets have not seen the same result.

Last financial year its US and Asian interests had a return on equity of 10.8 per cent but this year it has dropped in Asia.

Its European assets were at 10.5 per cent while Asia was just 9 per cent.

"Mainfreight haven't demonstrated the ability to effectively get better returns on assets acquired off-shore," the source said.

Shares in Mainfreight closed up 10c yesterday at $9.86.