Inside the Fisher & Paykel Healthcare factory in East Tamaki, Auckland. Photo / Dean Purcell
Macquarie Group lifted its 12-month target price on Fisher & Paykel Healthcare by 7.3 per cent and kept its 'outperform' rating after the company's full-year revenue growth beat expectations and as a weaker New Zealand dollar weighs in the exporter's favour.
The Australian investment house has a 12-month target price
of $11, up from $10.25. The stock recently unchanged at $10.10.
F&P Healthcare yesterday posted an 18 per cent gain in full-year profit, meeting guidance with record annual sales, and said revenue in the current year may reach $1 billion. Profit rose to a record $169 million in the 12 months ended March 31, from $143m a year earlier, while operating revenue climbed 10 percent to $894m.
"Revenue growth was stronger than expected, driven by a stronger-than-expected result from both home and hospital and higher-than-expected hedging gains," Macquarie said in its report.
However, it noted litigation costs over a patent dispute with ResMed were significantly higher than anticipated. F&P Healthcare competes with Resmed and Respironics and is currently engaged in a patent dispute with Resmed which generated $20.7m in legal costs in the 2017 year. The company filed patent infringement proceedings against Resmed, which countered with its own suit claim that F&P Healthcare's OSA (obstructive sleep apnea) products infringed its patents.
