We assign a fundamental rating of 5 out of 10 to SHC. SHC was compared to 58 industry peers in the Life Sciences Tools & Services industry. SHC scores excellent on profitability, but there are concerns on its financial health. SHC is not valued too expensively and it also shows a decent growth rate.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

SHC had positive earnings in the past year.
SHC had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: SHC reported negative net income in multiple years.
SHC had a positive operating cash flow in 4 of the past 5 years.

1.2 Ratios

Looking at the Return On Assets, with a value of 1.74%, SHC is in the better half of the industry, outperforming 70.69% of the companies in the same industry.
SHC has a better Return On Equity (10.07%) than 81.03% of its industry peers.
The Return On Invested Capital of SHC (9.23%) is better than 82.76% of its industry peers.
The Average Return On Invested Capital over the past 3 years for SHC is significantly below the industry average of 13.29%.
The 3 year average ROIC (8.04%) for SHC is below the current ROIC(9.23%), indicating increased profibility in the last year.

		Industry Rank	Sector Rank
ROA	1.74%
ROE	10.07%
ROIC	9.23%

ROA(3y)-1.47%

ROA(5y)-0.34%

ROE(3y)-14.75%

ROE(5y)-6.62%

ROIC(3y)8.04%

ROIC(5y)7.61%

1.3 Margins

SHC has a Profit Margin of 4.82%. This is in the better half of the industry: SHC outperforms 72.41% of its industry peers.
In the last couple of years the Profit Margin of SHC has declined.
SHC has a better Operating Margin (29.89%) than 100.00% of its industry peers.
SHC's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 55.98%, SHC is in the better half of the industry, outperforming 70.69% of the companies in the same industry.
SHC's Gross Margin has improved in the last couple of years.

		Industry Rank	Sector Rank
OM	29.89%
PM (TTM)	4.82%
GM	55.98%

OM growth 3Y-0.64%

OM growth 5Y2.13%

PM growth 3Y-31.23%

PM growth 5YN/A

GM growth 3Y-0.57%

GM growth 5Y1.5%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), SHC is destroying value.
The number of shares outstanding for SHC has been increased compared to 1 year ago.
Compared to 5 years ago, SHC has more shares outstanding
Compared to 1 year ago, SHC has a worse debt to assets ratio.

2.2 Solvency

SHC has an Altman-Z score of 1.77. This is a bad value and indicates that SHC is not financially healthy and even has some risk of bankruptcy.
SHC has a Altman-Z score (1.77) which is in line with its industry peers.
The Debt to FCF ratio of SHC is 25.87, which is on the high side as it means it would take SHC, 25.87 years of fcf income to pay off all of its debts.
SHC has a Debt to FCF ratio (25.87) which is comparable to the rest of the industry.
A Debt/Equity ratio of 4.04 is on the high side and indicates that SHC has dependencies on debt financing.
The Debt to Equity ratio of SHC (4.04) is worse than 91.38% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	4.04
Debt/FCF	25.87
Altman-Z	1.77

ROIC/WACC0.82

WACC11.22%

2.3 Liquidity

SHC has a Current Ratio of 2.38. This indicates that SHC is financially healthy and has no problem in meeting its short term obligations.
SHC has a Current ratio (2.38) which is comparable to the rest of the industry.
SHC has a Quick Ratio of 2.16. This indicates that SHC is financially healthy and has no problem in meeting its short term obligations.
SHC's Quick ratio of 2.16 is in line compared to the rest of the industry. SHC outperforms 48.28% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	2.38
Quick Ratio	2.16

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an nice 8.00% over the past year.
SHC shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -7.34% yearly.
The Revenue for SHC has decreased by -15.95% in the past year. This is quite bad
The Revenue has been growing slightly by 7.17% on average over the past years.

EPS 1Y (TTM)8%

EPS 3Y-7.34%

EPS 5YN/A

EPS Q2Q%52.94%

Revenue 1Y (TTM)-15.95%

Revenue growth 3Y5.71%

Revenue growth 5Y7.17%

Sales Q2Q%9.05%

3.2 Future

Based on estimates for the next years, SHC will show a quite strong growth in Earnings Per Share. The EPS will grow by 15.65% on average per year.
Based on estimates for the next years, SHC will show a small growth in Revenue. The Revenue will grow by 6.85% on average per year.

EPS Next Y20.93%

EPS Next 2Y16.36%

EPS Next 3Y14.51%

EPS Next 5Y15.65%

Revenue Next Year5.31%

Revenue Next 2Y5.6%

Revenue Next 3Y5.78%

Revenue Next 5Y6.85%

3.3 Evolution

The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 22.37 indicates a rather expensive valuation of SHC.
84.48% of the companies in the same industry are more expensive than SHC, based on the Price/Earnings ratio.
SHC's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.30.
SHC is valuated rather expensively with a Price/Forward Earnings ratio of 19.12.
SHC's Price/Forward Earnings ratio is rather cheap when compared to the industry. SHC is cheaper than 91.38% of the companies in the same industry.
SHC is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 25.57, which is the current average of the S&P500 Index.

		Industry Rank	Sector Rank
PE	22.37
Fwd PE	19.12

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, SHC is valued cheaply inside the industry as 91.38% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, SHC is valued a bit cheaper than 60.34% of the companies in the same industry.

		Industry Rank	Sector Rank
P/FCF	59.43
EV/EBITDA	14.52

4.3 Compensation for Growth

SHC's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of SHC may justify a higher PE ratio.
A more expensive valuation may be justified as SHC's earnings are expected to grow with 14.51% in the coming years.