With the ASX suffering heavy falls over the past weeks, I think it’s beneficial to look back over the past year at some of our higher performing shares to remind ourselves that smart investing is very much a long-term pursuit.
So, here we look at two ASX healthcare shares that have performed very strongly over the past 12 months.
Fisher & Paykel Healthcare Corp Ltd (ASX: FPH)
New Zealand-based Fisher & Paykel Healthcare designs and manufactures a range of products used to treat respiratory illnesses, including for the treatment of obstructive sleep apnea. The healthcare provider continues to see strong demand for its products and this is reflected in the company’s share price.
While the S&P/ASX 200 Index (ASX: XJO) has fallen heavily since the sharp market correction began on February 20, Fisher & Paykel has actually seen a rise in its share price during that time from $23.93 to $26.30. Over the past 12 months, the Fisher & Paykel share price has grown by a very strong 77%.
Fisher & Paykel is actually playing a vital role in the fight against the coronavirus through the use of its respiratory humidifiers and consumables. The company has seen an increase in demand globally for these products and it has significantly increased its manufacturing output in order to try to keep up with the market’s needs.
On March 17, Fisher & Paykel upgraded its earnings guidance. Management now expects full-year operating revenue to be approximately NZ$1.24 billion and net profit after tax (NPAT) to be in the range of NZ$275 million to NZ$280 million. A key reason for this upgrade is the weakening New Zealand dollar, making the export of local goods more attractive.
Polynovo Ltd (ASX: PNV)
PolyNovo has seen a sharp correction in its share price over the past few weeks, falling 58% during that time. However, despite this fall, PolyNovo shares have still seen a very strong 78% increase over the past 12 months.
PolyNovo designs and manufactures an implantable dressing, NovoSorb BTM, which can be integrated into the body as it heals.
In late February, PolyNovo reported very high sales and earnings growth for the first half of FY 2020. The company’s strategy is to continue to grow sales strongly in existing markets, while expanding growth in a range of overseas markets over the next few years. PolyNovo delivered a massive 80% increase in revenue over the prior corresponding period, totalling $10.2 million. Sales of NovoSorb BTM sales climbed sharply by 129%.
On March 11, PolyNovo advised the market that the coronavirus outbreak is unlikely to have a direct impact on its sales pipeline. The company noted that it doesn’t source raw materials directly from China and it also uses a variety of suppliers. In addition, PolyNovo believes it has access to sufficient raw materials in the short term.
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Motley Fool contributor Phil Harpur has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.