It's been a great afternoon session for Koninklijke Philips investors, who saw their shares rise 2.7% to a price of $27.95 per share. At these higher prices, is the company still fairly valued? If you are thinking about investing, make sure to check the company's fundamentals before making a decision.
Koninklijke Philips's Valuation Is in Line With Its Sector Averages:
Koninklijke Philips N.V. operates as a health technology company in North America, the Greater China, and internationally. The company belongs to the Health Care sector, which has an average price to earnings (P/E) ratio of 22.94 and an average price to book (P/B) ratio of 3.19. In contrast, Koninklijke Philips has a trailing 12 month P/E ratio of 147.1 and a P/B ratio of 2.56.
Koninklijke Philips has moved 0.5% over the last year compared to 18.5% for the S&P 500 — a difference of -18.0%. Koninklijke Philips has a 52 week high of $29.29 and a 52 week low of $21.48.
The Business Is Unprofitable and Its Balance Sheet Is Highly Leveraged:
| 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $17,147 | $17,313 | $17,156 | $17,827 | $18,169 | $18,021 |
| Gross Margins | 46% | 45% | 42% | 40% | 41% | 43% |
| Net Margins | 7% | 7% | 19% | -9% | -3% | -4% |
| Net Income (M) | $1,173 | $1,195 | $3,323 | -$1,605 | -$463 | -$698 |
| Net Interest Expense (M) | $196 | $173 | $159 | $235 | $277 | $288 |
| Depreciation & Amort. (M) | $1,343 | $1,462 | $1,323 | $1,602 | $1,261 | $1,390 |
| Diluted Shares (M) | 891 | 905 | 870 | 881 | 906 | 925 |
| Earnings Per Share | $1.25 | $1.29 | $3.5 | -$1.69 | -$0.49 | -$0.75 |
| EPS Growth | n/a | 3.2% | 171.32% | -148.29% | 71.01% | -53.06% |
| Total Debt (M) | $4,939 | $5,705 | $6,473 | $7,270 | $7,035 | $7,113 |
| Net Debt / EBITDA | 1.3 | 0.91 | 2.22 | 83.53 | 4.51 | 2.46 |
| Current Ratio | 1.36 | 1.45 | 1.39 | 1.29 | 1.2 | 1.23 |
Koninklijke Philips has slimmer gross margins than its peers, declining EPS growth, and a highly leveraged balance sheet. Koninklijke Philips has just enough current assets to cover current liabilities, as shown by its current ratio of 1.23.
