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Koninklijke Philips NV PHIA

Morningstar Rating
€19.40 −0.22 (1.12%)
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Company Report

Consent Decree Curtails Philips' Sleep and Respiratory Growth for Several Years

Philips is a one-stop shop for imaging-related devices with an established footprint in many hospitals, which positions it to benefit from long-term healthcare trends like the transition to noninvasive or minimally invasive procedures and increased hospital demand for efficiencies. Through several divestitures and acquisitions, Philips has transformed itself from an industrial medical conglomerate into a healthcare company and primary supplier across hospitals, which facilitates the introduction of new products and the displacement of smaller suppliers with more depth in a single product line but lack of breadth. In many of its underlying markets, the company operates in an oligopoly where significant market share is controlled by a few players. Several of Philips' products require proprietary software or service; this provides stability to cash flows and helps to lock in customers. In addition, the company has carried out several divestments and acquisitions, which we believe has reinforced its positioning.

Price vs Fair Value

PHIA is trading at a 7% discount.
Price
€19.60
Fair Value
€95.00
Uncertainty
High
1-Star Price
€65.17
5-Star Price
€87.40
Economic Moat
Tbdry
Capital Allocation
Crzjstskz

Bulls Say, Bears Say

Bulls

Philips' large installed base in imaging devices and existing footprint in many hospitals is an advantage that allows it to cross-sell and introduce new products with less effort than other smaller players.

Bears

The continued transition to value-based care in many parts of the world will result in structural price declines for Philips' imaging business.

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News

Trading Information

Previous Close Price
€19.62
Day Range
€19.3519.65
52-Week Range
€16.4822.18
Bid/Ask
€19.40 / €19.41
Market Cap
€17.61 Bil
Volume/Avg
725,614 / 1.9 Mil

Key Statistics

Price/Earnings (Normalized)
15.83
Price/Sales
1.03
Dividend Yield (Trailing)
Dividend Yield (Forward)
Total Yield
3.72%

Company Profile

Philips is a diversified global healthcare company operating in three segments: diagnosis and treatment, connected care, and personal health. Around 50% of the company's revenue comes from the diagnosis and treatment segment, which features imaging systems, ultrasound equipment, image-guided therapy solutions and healthcare informatics. The connected care segment (around 30% of revenue) encompasses monitoring and analytics systems for hospitals and sleep and respiratory care devices, whereas the personal health business (remainder of revenue) includes electric toothbrushes and men's grooming and personal-care products.
Sector
Healthcare
Industry
Medical Devices
Stock Style Box
Large Core
Total Number of Employees
69,656

Competitors

Valuation

Metric
PHIA
GE
SIE
Price/Earnings (Normalized)
15.8347.5214.51
Price/Book Value
1.485.843.01
Price/Sales
1.032.521.80
Price/Cash Flow
21.5941.6412.32
Price/Earnings
PHIA
GE
SIE

Financial Strength

Metric
PHIA
GE
SIE
Quick Ratio
0.740.761.02
Current Ratio
1.201.171.32
Interest Coverage
−0.875.227.36
Quick Ratio
PHIA
GE
SIE

Profitability

Metric
PHIA
GE
SIE
Return on Assets (Normalized)
3.84%3.12%5.14%
Return on Equity (Normalized)
9.21%17.00%16.08%
Return on Invested Capital (Normalized)
6.73%10.09%6.58%
Return on Assets
PHIA
GE
SIE
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