Test data could cut lawsuit risk

Article Excerpt

PHILIPS ELECTRONICS N.V. ADRs $21 is a buy. The company (New York symbol PHG; Conservative Growth Portfolio, Manufacturing sector; ADRs outstanding: 870.2 million; Market cap: $18.3 billion; Price-to-sales ratio: 1.1; Dividend yield: 4.3%; TSINetwork Rating: Average; www.philips.com) makes industrial health-care products, including X-ray scanners and ultrasound systems, along with consumer goods such as electric shavers and electric toothbrushes. The stock has dropped 44% since the start of 2022, mainly due to the recall of 5.5 million sleep apnea and ventilator machines over concerns that a type of foam used in the devices could degrade and release harmful particles. The company has set aside 885 million euros (1 euro=$1.30 Canadian) to cover those costs. Philips announced that the foam degradation problem stems from the use of unauthorized cleaning products. Tests also showed that the foam particles did not seem to leave the machine. That will help the company fend off the inevitable class-action lawsuits related to the recall. Philips is a buy. buy…

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