RMD - Philips Now Has More Problems Than Just The DreamStation Recall
- Problems have continued to mount at Philips, with poor Q4'21 results and weaker FY'22 guidance adding to the misery.
- An FDA inspection suggested Philips may have known about the DreamStation foam issue earlier than previously thought, but subsequent testing appears to be showing low demonstrable health risks.
- Execution is back on the table as an issue at Philips, and management needs to show improved results from its imaging operations.
- Even with an elevated discount rate and assumed payouts for the foam issue, 3% revenue growth and low double-digit FCF margins (long-term) can support a higher price.
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Philips Now Has More Problems Than Just The DreamStation Recall