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Philips Announced the Pricing of Its Lighting IPO

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Dec. 4 2020, Updated 10:52 a.m. ET

Price movement

Koninklijke Philips (PHG) has a market cap of $24.9 billion. It rose by 1.4% to close at $26.82 per share on May 26, 2016. The stock’s weekly, monthly, and year-to-date (or YTD) price movements were 4.4%, -0.67%, and 9.1%, respectively, on the same day.

This means that PHG is trading 3.8% above its 20-day moving average, 1.3% above its 50-day moving average, and 6.22% above its 200-day moving average.

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Related ETFs and peers

The Vanguard FTSE Europe ETF (VGK) invests 0.30% of its holdings in Philips. This ETF tracks the FTSE Developed Europe Index, a market-cap weighted index of European securities. The YTD price movement of VGK was 1.0% on May 26, 2016.

The Vanguard FTSE Developed Markets ETF (VEA) invests 0.18% of its holdings in Philips. The ETF tracks a market-cap-weighted index of large- and mid-cap stocks from developed markets outside the US, dynamically transitioning to include small caps and Canadian stocks.

The market caps of Philips’s competitors are as follows:

  • General Electric (GE) — $278.8 billion
  • Hologic (HOLX) — $9.4 billion

Performance of Koninklijke Philips in fiscal 1Q16

Koninklijke Philips (PHG) reported fiscal 1Q16 sales of 5.5 billion euros, a rise of 3.3% compared to sales of 5.3 billion euros in fiscal 1Q15. Sales from its Personal Health, Diagnosis and Treatment, and Connected Care and Health Informatics segments rose by 5.8%, 8.8%, and 11.0%, respectively.

Sales from the HealthTech Other and Lighting segments fell by 23.7% and 1.8%, respectively, in fiscal 1Q16 compared to fiscal 1Q15. The company’s cost of sales as a percentage of sales fell by 1.7%, and its operating income rose by 43.2% in fiscal 1Q16 compared to fiscal 1Q15.

Its net income and EPS (earnings per share) fell to 37.0 million euros and 0.03 euros, respectively, in fiscal 1Q16. That compares to 100.0 million euros and 0.11 euros, respectively, in fiscal 1Q15.

Koninklijke Philips’s cash and cash equivalents fell by 21.6%, and its inventories rose by 4.0% in fiscal 1Q16 compared to fiscal 4Q15. Its current ratio and long-term debt-to-equity ratio fell to ~1.2x and 0.75x, respectively, compared to ~1.3x and 0.77x, respectively, in fiscal 4Q15.

Philips’s IPO for its lighting unit

Koninklijke Philips (PHG) raised 750 million euros ($839 million) from its initial public offering (or IPO) of its Lighting business. It reduced the price range and set the price at 20 euros per share for 37.5 million shares.

Philips was planning to raise 970 million euros ($1.1 billion) from the IPO of its lighting unit, which will be listed on Amsterdam’s stock exchange after the company failed to get a buyer from the private sale. It also planned to sell 37.5 million shares in the price range of 18.50 euros–22.50 euros per share.

Now, let’s take a look at Gildan Activewear.

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