UBS does not expect the recall of the Philips DreamStation will have a material impact on Fisher & Paykel Healthcare earnings.
The recall is likely to be more wide reaching than first assessed, the broker points out, with US class action lawsuits claiming the foam breakdown may affect organs or cause cancer.
Yet share gains in flow generator sales are mainly shifting to ResMed ((RMD)), in particular, the broker notes, in the case of prescriptions by sleep doctors.
UBS retains a Sell rating, believing the stock is overvalued and there will be negative earnings momentum as covid-19 hospitalisation rates fade. Target is NZ$22.65.
Sector: Health Care Equipment & Services.
Current Price is $28.29. Target price not assessed.
