Auckland-based healthcare company Fisher & Paykel Healthcare Corporation Ltd [ASX:FPH] saw its products in high demand in line with COVID-19.
Specialising in respiratory care products, the FPH share price is experiencing a strong run-up.
The FPH share price is at $32.77 at the time of writing, down 1.44% after releasing a trading update yesterday.
What’s happening at Fisher & Paykel?
The onset of the novel COVID-19 pandemic saw the global need for respiratory care products rapidly expand.
Being a producer of these products, Fisher & Paykel responded to the changing conditions of the health crisis.
Distributing products globally, the company saw hospital hardware sales continuing to steadily increase over the first four months of FY21, with 390%-plus constant currency revenue growth to the end of July, compared to the prior comparable period.
Global sales for the company peaked in April, dipped in July, and then returned to the high April levels.
This helped the company record a very strong finish to the first quarter.
For the first four months of FY21, hospital consumables revenue has grown 48%, and overall hospital product group revenue has grown 91%, compared to the prior comparable period and in constant currency terms.
According to the company, this strong demand should see full-year operating revenue for the 2021 financial year sit at approximately $1.61 billion and net profit after tax would be approximately $365–385 million.
While this is great in a financial sense, it also indicated that we aren’t really any closer to getting on top of COVID-19 and resuming normal life.
Where to from here for FPH share price?
Now, it seems that while there is COVID-19 around there will be a strong need for Fisher & Paykel’s products.
With the price trading at $33.05 at the time of writing, it looks to of turned away from the short-term counter trend downwards.
If the FPH share price continues to go up and can move past the most recent all-time high of $34.92, then the levels of $35.30 and $37.70 may provide future resistance.
If the FPH share price turns to retrace again, then the levels of $32 and $30 may provide support from a future fall.
Interestingly, the level of $32 was the all-time high set back in April, and with demand for Fisher & Paykel’s products being very strong, if the price does fall this level may prove to be resilient.
For Money Morning
PS: Four well-positioned small-cap stocks: These innovative Aussie companies are well-placed to capitalise on post-lockdown mega-trends, and two are growing players in Australian e-commerce. Click here to learn more.