RYLPF - Koninklijke Philips: Still On The Cautious Line

2024-01-24 11:49:00 ET

Summary

• We see no positive catalyst into 2024. On the contrary, the Respironics settlement might weigh on the company's share price.
• After the JPM healthcare conference, the CEO refrained from commenting on FDA potential outcomes.
• Given a higher outlook, we slightly increased Philips' target price, maintaining an equal weight valuation.

Following our recent update on Exor (EXXRF) called " Discount To NAV Unjustified " and its recent 15% equity stake investment in Koninklijke Philips N.V. ( PHG ), we are back to comment on the European MedTech company. As a reminder, Philips was penalized by the Respironics settlement, supply chain constraints, and inflation. Consequently, the company's stock price declined by more than 50% due to rising yields and multiple contractions. Taking advantage of Exor's recent presentation (Fig 1), we can see Philips's stock price development after the " respironics recall and operational difficulties ."...

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