I’ve been looking at initial public offerings (IPOs) recently to see how you would have fared if you invested in them.

The last one I looked at was Altium Limited (ASX: ALU), which has rewarded its IPO investors handsomely over the last couple of decades. This is even after a few major hiccups over the years.

Today I thought I would take a look at private hospital operator Ramsay Health Care Limited (ASX: RHC).

Ramsay Health Care.

Ramsay Health Care came into existence in 1964 when founder Paul Ramsay purchased a guesthouse on Sydney’s North Shore called Warrina House and converted it into a psychiatric hospital.

Over the next decade and a half the company expanded its psychiatric hospital business before diversifying into medical and surgical businesses. In 1978 the company built its first surgical hospital – the Baringa Private Hospital in Coffs Harbour.

Fast forward to today and Ramsay is one of the largest healthcare companies in the world with a total of 480 facilities across 11 countries.

The Ramsay IPO.

In September 1997 Ramsay Health Care floated on the Australian Stock Exchange.

Details of the IPO are surprisingly limited, but according to Yahoo Finance, Ramsay’s shares were trading at an adjusted price of $1.15 on September 30 1997.

This means that $10,000 invested into Ramsay’s shares on that date would have yielded you 8,696 shares.

This afternoon Ramsay’s shares are changing hands at $67.22. Which means those 8,696 shares have a market value of almost $585,000 today.

In addition to this, although Ramsay has deferred its dividend for FY 2020 due to the pandemic, in time I expect its dividend to return to normal and then begin its growth trajectory again.

This will be good news to long term investors, because in FY 2019 the company paid dividends of $3.30 per share.

This means those 8,696 shares generated total dividends of $28,700 in FY 2019. Not bad for a $10,000 investment back in 1997!

More reading

• ASX 200 climbs 1% in positive start to the week
• Why the Ramsay share price is climbing
• How to invest $5,000 in ASX 200 healthcare shares today
• 5 ASX 200 winners and 5 losers of the week
• These small cap ASX shares could be stars of the future

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Altium. The Motley Fool Australia has recommended Ramsay Health Care Limited. 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.

The post If you invested $10,000 in the Ramsay Health Care IPO, this is how much you’d have now appeared first on Motley Fool Australia.

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The Cochlear Limited (ASX: COH) share price is edging lower today as the company announced it has been denied an appeal rehearing in its US patent infringement case.

While the S&P/ASX 200 Index (ASX: XJO) is currently storming 1.92% higher on the back of COVID-19 vaccine news, the Cochlear share price is down 2.54% for the day at $184.21.

Previous developments

This morning’s announcement relates to Cochlear’s ongoing court battle with Alfred E. Mann Foundation for Scientific Research (AMF) and Advanced Bionics (AB).

In November 2018, the US District Court in Los Angeles ruled against Cochlear and awarded damages totalling approximately US$268.1 million to AMF and AB. The company appealed this decision soon after.

Prior to this, the case had been dragging on for years. Back in 2014, a jury found that a group of Cochlear’s implants, sound processors, and software infringed 2 of AMF’s patents. Since then, there have been numerous rulings in favour and against Cochlear.

The result of the appeal of the November 2018 decision was finally handed down in March this year, with the US Court of Appeals for the Federal Circuit in Washington D.C. affirming the previous decision. As such, the court ordered the Cochlear to pay the US$268 million of damages to AMF and AB.

At the time of the announcement, the company stated in an ASX release it would “seek an en banc review by the full Court of Appeals in a petition for a rehearing”.

What did Cochlear announce today?

This morning, the company revealed that the US Court of Appeals had denied its petition for a rehearing of the appeal.

The judgement will become final on 26 May 2020 and Cochlear will now pay approximately US$280 million, which includes post-judgment interest. The company noted that it has committed loan facilities available to fund the payment.

Meanwhile, a decision is still pending in the US District Court on AMF and AB’s application for pre-judgment interest of US$123 million and attorney fees of $15 million. Cochlear has opposed both applications and the associated calculation methodology for the amounts.

As there is significant uncertainty over whether Cochlear will be forced to make these payments, the company is treating this exposure as a contingent liability on its balance sheet.

More reading

• The ASX big bank stock most likely to outperform in the COVID-19 recovery
• Should you throw $3,000 into Altium shares today?
• 3 ASX shares to instantly diversify your portfolio
• Are ASX 200 travel shares in the buy zone?
• Is the Bega Cheese share price a strong ASX buy today?

Cathryn Goh has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Cochlear Ltd. The Motley Fool Australia has recommended Cochlear Ltd. 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.

The post Cochlear share price edges lower on patent infringement news appeared first on Motley Fool Australia.

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