Shares surge as F&P Health hits $20b

Fletcher also a solid gainer but SkyCity slumps again

New Zealand shares extended Monday’s gain, following Wall Street’s lead overnight and as Fisher & Paykel Healthcare became the NZX’s first $20 billion company.

The S&P/NZX 50 Index rose 198.51 points, or 1.8 per cent, to 11,451.05. Within the index, 30 stocks rose, 12 fell, and eight were unchanged. Turnover was $293.4 million.

Investors continued to react to F&P Healthcare’s record result, driving its share price up 6.3 per cent to $35.60 and giving it a market capitalisation of $20.46b — the first homegrown listed company to cross the $20b threshold.

On Monday, the medical device maker reported a 37 per cent lift in annual profit to $287.3 million and forecast that to rise to between $325m and $340m in the March 2021 year.

Sam Trethewey, a portfolio manager at Milford Asset Management, said the Covid-19 pandemic accelerated the adoption of F&P Healthcare’s products and had been extremely well-received. “They have increased production of some product lines three times in response to Covid.”

And, with F&P Healthcare’s products only reaching 10 per cent of the addressable market, there was still potential for further growth ahead.

The strong performance on the local bourse was underpinned by Wall Street bouncing back from Friday night’s sell off. US investors were again “buying the dip” in hopes of further monetary stimulus supporting the economic recovery.

“The positive lead overnight from Wall Street showed there was still cash out there and people that are willing to put money to work on dips,” Trethewey said. Fletcher Building rose 4.8 per cent to $3.70 after saying it would make an early repayment of US$300m ($467.5m) of its most expensive debt, USPP notes. That will reduce its funding costs by $17m per year, and still leave the company with $1.1b of liquidity. Air New Zealand rose 4.8 per cent to $1.32 and Auckland International Airport advanced 2.2 per cent to $6.57. Kathmandu Holdings snapped a three-day decline, rising 3.7 per cent to $1.13.

The dual-listed lenders also gained ground. Westpac Banking Corp rose 3.1 per cent to $19.40 and ANZ Bank

ing Group increased 2.4 per cent to $20.15.

Oceania Healthcare increased 3.5 per cent to 90 cents, Metlifecare rose 2.2 per cent to $5.14, Ryman Healthcare advanced 2 per cent to $13.08 and Summerset Group climbed 1.6 per cent to $6.46.

Among blue chip stocks, A2 Milk rose 2.2 per cent to $20.19 and Spark was up 1.8 per cent to $4.56.

Meridian Energy fell 2.6 per cent to $4.81 after the Electricity Authority said the country’s biggest electricity generator potentially created an ‘undesirable trading situation’ that cost consumers as much as $80m.

SkyCity Entertainment posted the day’s largest drop, falling 4 per cent to $2.39 in the stock’s fifth straight decline. Vista Group dropped 2.7 per cent to $1.45. Outside the benchmark index,

Cooks Global Foods fell 5 per cent to 5.7 cents after it said it didn’t expect trading at its cafe franchises to return to normal until the second half of the 2021 financial year.