Is Koninklijke Philips N.V. (PHG) positioned for future growth?

Koninklijke Philips N.V. (NYSE: PHG) stock fell -4.32% on Friday to $16.84 against a previous-day closing price of $17.60. With 2.11 million shares changed hands, the volume of the stock remained heavier than its average volume of 2.05 million shares. During the session, the Diagnostics & Research company that operates in wider Healthcare sector, reached to the highest price of $17.29 whereas the lowest price it dropped to was $16.84. The 52-week range on PHG shows that it touched its highest point at $48.31 and its lowest point at $16.13 during that stretch. It currently has a 1-year price target of $32.60. With its current market cap of 14.81 billion, PHG has annualized dividend of $0.91 while the current yield stands at 5.42%. Beta for the stock currently stands at 0.94.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of PHG was down-trending over the past week, with a drop of -2.66%, but this was down by -5.50% over a month. Three-month performance dropped to -19.19% while six-month performance fell -45.71%. The stock lost -64.01% in the past year, while it has lost -54.30% so far this year. A look at the trailing 12-month EPS for PHG yields 0.43 with Next year EPS estimates of 1.64. EPS is expected to grow by 11.10% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of -4.30%.

Float and Shares Shorts:

At present, 884.17 million PHG shares are outstanding with a float of 873.34 million shares on hand for trading. On Jul 14, 2022, short shares totaled 2.76 million, which was 0.31% higher than short shares on Jun 14, 2022. In addition to Mr. François Adrianus van Houten as the firm’s Chairman of Management & CEO, Dr. Paulus A. Stoffels M.D., Ph.D. serves as its Independent Vice Chairman of Supervisory Board & Sec.

Institutional Ownership:

Through their ownership of 14.49% of PHG’s outstanding shares, institutional investors have minority control over the company. Other institutions hold 2.39% of PHG, in contrast to 11.78% held by mutual funds. Shares owned by individuals account for –. As the largest shareholder in PHG with 4.42% of the stake, T. Rowe Price Associates, Inc. holds 39,303,903 shares worth 39,303,903. A second-largest stockholder of PHG, Harris Associates LP, holds 16,990,012 shares, controlling over 1.91% of the firm’s shares. Wellington Management Co. LLP is the third largest shareholder in PHG, holding 7,738,873 shares or 0.87% stake. With a 0.55% stake in PHG, the Vanguard Wellesley Income Fund is the largest stakeholder. A total of 4,904,526 shares are owned by the mutual fund manager. The FMI Large Cap Fund, which owns about 0.26% of PHG stock, is the second-largest Mutual Fund holder. It holds 2,310,000 shares valued at 38.3 million. American Century Mid Cap Value Fu holds 0.20% of the stake in PHG, owning 1,751,286 shares worth 29.04 million.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for PHG since 15 analysts follow the stock currently. There are 5 analysts who recommend BUY ratings, while 1 suggest SELL ratings. Of the remaining analysts, 8 believe that the stock is worth HOLDING, 1 give it an OVERWEIGHT rating, and 0 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With PHG analysts setting a high price target of $40.87 and a low target of $16.45, the average target price over the next 12 months is $24.81. Based on these targets, PHG could surge 142.7% to reach the target high and fall by -2.32% to reach the target low. Reaching the average price target will result in a growth of 47.33% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. PHG will report FY 2022 earnings on 01/24/2023. Analysts have provided yearly estimates in a range of $1.66 being high and $1.05 being low. For PHG, this leads to a yearly average estimate of $1.31. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Koninklijke Philips N.V. surprised analysts by -$0.13 when it reported $0.14 EPS against a consensus estimate of $0.27. The surprise factor in the prior quarter was -$0.10. Based on analyst estimates, the high estimate for the next quarter is $0.34 and the low estimate is $0.30. The average estimate for the next quarter is thus $0.32.

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