After a 10% gain in a single day, here's how Macquarie rates this ASX 200 healthcare share

This ASX 200 healthcare share surged 10% yesterday after the company released its FY25 report.

| More on:
A happy doctor in a white coat dancing due to his excitement over the EBOS acquisition

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

After a ripper day yesterday, ASX 200 healthcare share Ansell Ltd (ASX: ANN) is off the boil on Tuesday, down 0.58%.

This is likely due to the market calming down after yesterday's 10.2% lift, and the broader market also being lower today.

At the time of writing, the Ansell share price is $34.31, while the S&P/ASX 200 Index (ASX: XJO) is down 0.52%.

The ASX 200 healthcare share rocketed yesterday after the personal protective equipment (PPE) manufacturer released its FY25 report.

At its intraday peak, Ansell shares were trading at $36.37, up 16.2% on Monday. Clearly, investors were happy with the numbers.

In this article, we'll recap those results and find out how top broker Macquarie now rates this ASX 200 healthcare share.

Ansell shares rip on boosted sales in FY25

Ansell reported US$2 billion in sales in FY25, up 7.7% on FY24 on an organic constant currency basis and up 23.7% on a reported basis.

It noted that its organic basis was adjusted for the effects of acquisitions, divestments, and business exits over the year.

This included the $635 million acquisition of Kimberly-Clark Corporation's PPE business (KBU) on 1 July 2024.

The FY25 earnings before interest and tax (EBIT), before significant items, were US$282 million.

That's up 10.4% on an organic constant currency basis and up 44.3% on a reported basis.

Ansell achieved a 19.5% year-over-year increase in adjusted earnings per share (EPS) to US$1.26 a share.

That was at the upper end of its guidance range.

Looking ahead, Ansell said raised prices would fully offset the cost impact of the US tariffs.

The company implemented an initial round of price increases in June.

Further price rises will be implemented shortly based on the finalised US tariffs announced on 31 July.

Looking ahead, Ansell is guiding adjusted EPS in the range of 133 to 145 US cents for FY26.

Ansell said:

End market conditions are expected to be mixed, with solid healthcare demand offset by subdued demand in some industrial verticals. In addition, the economic effects of higher tariffs in the US remain unclear.

Against this backdrop, we anticipate constant currency sales growth from both higher volumes and tariff-related pricing.

Ansell shares will pay a final unfranked dividend of 28 US cents per share.

That's up 27.9% from the FY24 final dividend.

The company announced it would resume its on-market share buyback program in FY26.

It plans to buy back up to $200 million worth of stock.

Top broker's view of ASX 200 healthcare share

Macquarie issued a new note today on Ansell shares and the outlook for FY26.

The broker has retained a neutral rating on the ASX 200 healthcare share and raised its 12-month price target slightly to $33.50.

The Ansell share price is trading above that target today.

Clearly, Macquarie thinks this ASX 200 healthcare share is fully valued now.

In other words, the broker does not foresee any share price growth over the year ahead.

Macquarie acknowledged the "strong performance from the KBU segment" in FY25.

It also noted Ansell's "operational excellence in mitigating tariff impacts" following its share price fall.

Ansell shares fell 14% on the day the tariffs were announced in April.

That same week, the company released a statement confirming that about 43% of its revenue came from the US.

At the time, the majority of Ansell's products sold in the US were imported from Malaysia, Sri Lanka, Thailand, Vietnam, and China.

You can check out the finalised individual US tariffs for all of these countries here.

The broker commented:

FY25 EBIT was +1% ahead of our forecasts, with EBIT margin ~50bps ahead supported by improved utilisation, higher APIP savings and KBU mix benefit.

Our revised forecasts are at the mid-point of guidance of US133-145cps (MRE: US139cps), with a net neutral impact expected from US tariffs.

While we see medium-term EPS growth outlook as positive, we see this as adequately captured in the current share price.

Ansell shares price snapshot

This ASX 200 healthcare share has risen by 15.5% over the past 12 months.

Motley Fool contributor Bronwyn Allen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Macquarie Group. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool Australia has recommended Ansell. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Broker Notes

White declining arrow on a blue graph with an animated man representing a falling share price.
Materials Shares

Experts call time on these rip-snorting ASX 200 mining shares

These 2 ASX 200 mining stocks have risen by 160% and 230%, respectively, over the past 12 months.

Read more »

Two people comparing and analysing material.
Broker Notes

Buy, hold, sell: Netwealth, Santos, and South32 shares

Morgans has given its verdict on these shares following updates.

Read more »

Business man at desk looking out window with his arms behind his head at a view of the city and stock trends overlay.
Broker Notes

Brokers name 3 ASX shares to buy today

Here's why brokers are feeling bullish about these three shares this week.

Read more »

Three smiling corporate people examine a model of a new building complex.
Broker Notes

Broker says this ASX All Ords stock could rise 15%

Bell Potter thinks investors should be buying this growing company's shares.

Read more »

A man slumps crankily over his morning coffee as it pours with rain outside.
Broker Notes

Why Lynas shares could crash 33%

Bell Potter believes this rare earths stock could lose a third of its value.

Read more »

Three girls compete in a race, running fast around an athletic track.
Broker Notes

Two ASX 200 stocks to buy after crashing 6-9% yesterday

Bell Potter is tipping an 18-40% resurgence for these stocks.

Read more »

A woman looks quizzical as she looks at a graph of the share market.
Broker Notes

Looking for double-digit returns? Check out RBC Capital Markets' picks ahead of reporting season

These shares could deliver strong upside.

Read more »

Man controlling a drone in the sky.
Broker Notes

ASX defence stocks to target according to Bell Potter

The bull run might not be finished yet for these two companies.

Read more »