SOLVENTUM CORP (SOLV)

US83444M1018 - Common Stock

73.2  +0.74 (+1.02%)

Fundamental Rating

3

Overall SOLV gets a fundamental rating of 3 out of 10. We evaluated SOLV against 188 industry peers in the Health Care Equipment & Supplies industry. While SOLV is still in line with the averages on profitability rating, there are concerns on its financial health. SOLV has a valuation in line with the averages, but on the other hand it scores bad on growth.



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5

1. Profitability

1.1 Basic Checks

In the past year SOLV was profitable.
SOLV had a positive operating cash flow in the past year.

1.2 Ratios

SOLV has a better Return On Assets (7.26%) than 87.70% of its industry peers.
The Return On Equity of SOLV (36.90%) is better than 98.40% of its industry peers.
The Return On Invested Capital of SOLV (10.23%) is better than 90.91% of its industry peers.
The Average Return On Invested Capital over the past 3 years for SOLV is above the industry average of 8.14%.
Industry RankSector Rank
ROA 7.26%
ROE 36.9%
ROIC 10.23%
ROA(3y)9.97%
ROA(5y)N/A
ROE(3y)11.69%
ROE(5y)N/A
ROIC(3y)11.33%
ROIC(5y)N/A

1.3 Margins

SOLV has a Profit Margin of 12.89%. This is amongst the best in the industry. SOLV outperforms 89.30% of its industry peers.
SOLV has a better Operating Margin (18.70%) than 91.44% of its industry peers.
With a Gross Margin value of 56.98%, SOLV perfoms like the industry average, outperforming 50.80% of the companies in the same industry.
Industry RankSector Rank
OM 18.7%
PM (TTM) 12.89%
GM 56.98%
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3YN/A
GM growth 5YN/A

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3

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so SOLV is still creating some value.
Compared to 1 year ago, SOLV has about the same amount of shares outstanding.
There is no outstanding debt for SOLV. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.

2.2 Solvency

SOLV has an Altman-Z score of 1.63. This is a bad value and indicates that SOLV is not financially healthy and even has some risk of bankruptcy.
SOLV has a Altman-Z score (1.63) which is comparable to the rest of the industry.
SOLV has a debt to FCF ratio of 5.45. This is a neutral value as SOLV would need 5.45 years to pay back of all of its debts.
The Debt to FCF ratio of SOLV (5.45) is better than 79.14% of its industry peers.
A Debt/Equity ratio of 2.90 is on the high side and indicates that SOLV has dependencies on debt financing.
SOLV's Debt to Equity ratio of 2.90 is on the low side compared to the rest of the industry. SOLV is outperformed by 87.70% of its industry peers.
Industry RankSector Rank
Debt/Equity 2.9
Debt/FCF 5.45
Altman-Z 1.63
ROIC/WACC1.13
WACC9.04%

2.3 Liquidity

SOLV has a Current Ratio of 1.31. This is a normal value and indicates that SOLV is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.31, SOLV is doing worse than 86.10% of the companies in the same industry.
A Quick Ratio of 0.96 indicates that SOLV may have some problems paying its short term obligations.
SOLV has a worse Quick ratio (0.96) than 82.35% of its industry peers.
Industry RankSector Rank
Current Ratio 1.31
Quick Ratio 0.96

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1

3. Growth

3.1 Past

The Earnings Per Share has been growing slightly by 0.22% over the past year.
SOLV shows a small growth in Revenue. In the last year, the Revenue has grown by 0.82%.
EPS 1Y (TTM)0.22%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-85.59%
Revenue 1Y (TTM)0.82%
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%-49.08%

3.2 Future

The Earnings Per Share is expected to decrease by -7.72% on average over the next years.
SOLV is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 1.40% yearly.
EPS Next Y-16.6%
EPS Next 2Y-14.51%
EPS Next 3Y-7.72%
EPS Next 5YN/A
Revenue Next Year2.05%
Revenue Next 2Y1.2%
Revenue Next 3Y1.4%
Revenue Next 5YN/A

3.3 Evolution

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6

4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 11.94, the valuation of SOLV can be described as reasonable.
Compared to the rest of the industry, the Price/Earnings ratio of SOLV indicates a rather cheap valuation: SOLV is cheaper than 95.19% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of SOLV to the average of the S&P500 Index (30.16), we can say SOLV is valued rather cheaply.
With a Price/Forward Earnings ratio of 12.83, SOLV is valued correctly.
SOLV's Price/Forward Earnings ratio is rather cheap when compared to the industry. SOLV is cheaper than 94.65% of the companies in the same industry.
SOLV is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 23.23, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 11.94
Fwd PE 12.83

4.2 Price Multiples

94.12% of the companies in the same industry are more expensive than SOLV, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, SOLV is valued cheaper than 97.33% of the companies in the same industry.
Industry RankSector Rank
P/FCF 8.3
EV/EBITDA 9.53

4.3 Compensation for Growth

A cheap valuation may be justified as SOLV's earnings are expected to decrease with -7.72% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-14.51%
EPS Next 3Y-7.72%

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0

5. Dividend

5.1 Amount

SOLV does not give a dividend.
Industry RankSector Rank
Dividend Yield N/A

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SOLVENTUM CORP

NYSE:SOLV (11/4/2024, 10:56:48 AM)

73.2

+0.74 (+1.02%)

Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Equipment & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap12.64B
Analysts
Price Target
Dividend
Industry RankSector Rank
Dividend Yield N/A
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
Max EPS beat(4)
EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
Avg Revenue beat(4)
Min Revenue beat(4)
Max Revenue beat(4)
Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
Industry RankSector Rank
PE 11.94
Fwd PE 12.83
P/S
P/FCF
P/OCF
P/B
P/tB
EV/EBITDA
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)N/A
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 7.26%
ROE 36.9%
ROCE
ROIC
ROICexc
ROICexgc
OM 18.7%
PM (TTM) 12.89%
GM 56.98%
FCFM
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.56
Health
Industry RankSector Rank
Debt/Equity 2.9
Debt/FCF
Debt/EBITDA
Cap/Depr
Cap/Sales
Interest Coverage
Cash Conversion
Profit Quality
Current Ratio 1.31
Quick Ratio 0.96
Altman-Z
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)0.22%
EPS 3YN/A
EPS 5Y
EPS Q2Q%
EPS Next Y-16.6%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)0.82%
Revenue growth 3YN/A
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y