Investors take breath for Fisher & Paykel Healthcare as NZX trades flat

Share volumes amounting to $104.3 million changed hands across the NZX on Tuesday as the main index, the S&P/NZX 50, rose 0.28% to 12,582.33 points.

Mohandeep Singh, a research analyst at Craigs Investment Partners, said budget excitement had cooled down, and attention had turned to the Reserve Bank of NZ's monetary policy statement on Wednesday.

“[It] is widely expected to put through another cut of 25 basis points, which would take us to 3.25%,” he said.

The rest of the week

Singh said the market was holding out until Wednesday, when a few of the country's largest listed companies will report earnings.

“Tomorrow is the key because you've got Fisher & Paykel Healthcare, our biggest market constituent, and then you've got Infratil tomorrow as well.”

Fisher & Paykel Healthcare was up 1.52% to $36.63 on market-leading volumes, amounting to $10.4m in value traded.

Singh said he will be looking out for how the company guides versus market expectations and for more detail about when the firm wants to get back to its 65% gross margin target.

"The 2025 result, which is backward-looking, will be strong because the currency has been helping, and it is generally pre-tariff stuff."

For Infratil, which ended the day 1.35% ahead at $11.27, Singh said eyes will be on their datacentre investment, Canberra Data Centres.

"[Investors] will look to see if they are seeing the same levels of demand and positivity that their key peer, NEXTDC, has recently talked about."

Stride Property and Rakon will also report on Wednesday, while Ryman Healthcare, Mainfreight, and Goodman Property will disclose earnings on Thursday.

Other equities

Fletcher Building's shares fell 3.09% to $3.14 but the stock remains nearly 9% up for the year-to-date.

Small-cap company Vital’s shares rallied 45.45% to 40 cents after it disclosed Tait International had declared its intention to take over the company.  

Tait Communications, a Christchurch-based critical communications systems provider, has offered 45 cents per share (cps). The all-cash offer represents a 64% premium over Vital’s last traded price of 27.5 cents before the trading halt on Monday.

Though prices are off their bottoms in April, Singh said the market is still ripe for merger and acquisition activity.

“If you've got an improving economic backdrop, and still people out there with cash to burn, then I think you're still going to see lots of interest in M&A.

“It's just not the big marquee stuff that grabs headlines, but there's lots of little stuff happening in the background."

Mid-cap transportation technology services company Eroad rose 6.54% to $1.14, compounding the 14% gain it made on Monday after a positive annual result.

Just before 6pm on the Australian Securities Exchange (ASX), NZ firm Straker was up 3.26% after it mapped out its artificial intelligence transformation to the market.

Total turnover fell 10.3% to $44.9m, driven by a 24.4% drop in language service revenue.

The decline was “expected”, the company said, because of the “strategic repositioning” and subdued market conditions, particularly in Europe.

Alongside Tuesday's full-year earnings, chief executive Grant Straker said the company “delivered strongly” on the guidance it gave the market in November.

At the same time, the S&P/ASX 200 had jumped 0.53%.