Philips Acquires PathXL to Expand Its Business



Price movement

Koninklijke Philips (PHG) has a market cap of $24.5 billion. It rose by 1.8% and closed at $26.15 per share on June 21, 2016. The stock’s weekly, monthly, and YTD (year-to-date) price movements were 4.6%, 1.7%, and 6.3%, respectively, on the same day. This means that Philips is trading 0.21% below its 20-day moving average, 0.47% below its 50-day moving average, and 3.3% 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. VGK tracks the FTSE Developed Europe Index—a market-cap weighted index of European securities. VGK’s YTD price movement was -0.07% on June 21, 2016.

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

The market cap of its competitors are as follows:

  • General Electric (GE) – $284.9 billion
  • Hologic (HOLX) – $9.6 billion

Philips acquired PathXL

Philips acquired PathXL—a company in digital pathology image analysis, workflow software, and educational tools. With this acquisition, the company can provide intelligent and integrated solutions in computational pathology, education, workflow solutions, and image analytics.

Performance in fiscal 1Q16

Koninklijke Philips 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.

Now, let’s take a look at Ralph Lauren.


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