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The Female Health Company engages in the manufacture, marketing, and distribution of the female condom.
While they are a one trick company as of right now, social forces are forcing an increased demand for the product.
Look for this company to increase as global health organizations continue to pour money into women's health issues and STDs.
Two days have been pounding this stock, as the company went from a small cap dividend payer to a small cap growth stock only. Divindend investors are dumping like crazy. At $4.20, the stock is selling a a P/E under 10. Considering their market opportunity, a small position could prove to be a long term good move.
The Business moat: For sexually active couples, condom is the only barrier method approved by FDA for preventing sexual transmission of HIV/AIDs.About FHCO: The company manufactures and sells FC2 condoms. They are the only female condoms approved by FDA and cleared by WHO for purchase by UN agencies. The company’s primary customers are large global agencies such as UNFPA, USAID. The current focus of the firm has been to distribute its product through agencies rather than tapping clients directly. Indirectly, the prime customers are the developing countries where the chances of STIs are high and product’s accessibility is quite low. These agencies distribute the condoms directly to these people.The Company’s moat: FC2’s classification as a Class III medical device creates a significant barrier to entry in the US market for other players. As per the company’s estimation, it usually takes a minimum of 4-6 years to launch another FDA approved condom. The right set of chord with government agencies and a good product quality has helped FHCO win big tenders.
http://www.gurufocus.com/insider/FHCO Female Condoms, via Niek Kraakman
Great ethical Stock for my portfolio.
sell the female condom. distributed abroad. massive free cash flow.
The price of FHCO is in decline since their last earnings release. What people seem to forget, and what FHCO management is constantly repeating, is that their income fluctuates immensely due to the spending patterns of governments and NGO's. Despite lower reported earnings there is NO decrease in demand, it is just the cycle.I therefore see this as an amazing opportunity to make us of irrational behavior by investors. This company has a tremendously strong balance sheet. My intrinsic value estimate is $12.
Long. 14x fye. 21% rev growth. Female condoms.
Management owns a big slice of the pie, here. They keep voting themselves new dividends. Sales of female condoms are increasing in the developing world.
This company has a great yield, low P/E and is solving a global problem.
Seems to be a fundamentally sound company, though the reliance on government and NGO income means I won't be adding it to my portfolio.
Decent financials, consumable product, lots of growth potential not only in industrializing countries, but in already-industrialized countries. That's a rare treat these days.
Top 25 best company pick
There is a defintie need for theior producct which will continue for quite a while.
underdeveloped nations need this
This has been a steady performer, bit it is still cheap. It also helps to have a product that is revolutionary.
During the London Summit in 2012, the Female Health Company announced a program to support the London Summit's goal to provide contraceptives to an additional 120 million women by 2020. This program includes a plan for the company to invest up to $14 million over the next six years in reproductive health and HIV/AIDS prevention education and training in collaboration with global agencies.
I just bought this in real life. The reasons I bought are:- Debt free balance sheet- Company has strong margins and produces healthy free cash flow. They even produced FCF in 2011 when their sales were way down due to some big orders that were delayed until 2012.- Very little (if any) competition. They have the only FDA approved product.- They have US and UK tax-loss carry forwards that will benefit net income.- Demand is increasing and they just completed an expansion of their production facility.A company that has a nice moat in a niche that should continue to grow, a strong balance sheet, and only one analyst following it. All that for 16x trailing earnings? I'm in. Peter Lynch would be proud.
It's a World Health Organization play. Not to worry about fundamentals, rather big public funding to spread their product around the 3rd world.
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