'Further proof required': RBC starts Philips at 'sector perform'

RBC initiates coverage on Philips PHG.AS at "sector perform", saying the healthcare technology company has to show further proof of execution despite a potential turnaround story beyond the 2022 recall of its sleep apnea devices

It says Philips' valuation discount to peers is justified by a weaker growth outlook and margins, despite having recovered from 2022 lows

"Ongoing regulatory and execution concerns also make us cautious," the broker says

RBC sets a price target of 25 euros ($29.31), which is 10% higher than Tuesday's close of 22.5 euros

Up to Tuesday's session, shares in Philips have dropped 7.6% this year

($1 = 0.8530 euros)