STERIS PLC (STE) Stock Fundamental Analysis
NYSE:STE - New York Stock Exchange, Inc. - IE00BFY8C754 - Common Stock
Overall STE gets a fundamental rating of 6 out of 10. We evaluated STE against 191 industry peers in the Health Care Equipment & Supplies industry. STE scores excellent on profitability, but there are some minor concerns on its financial health. STE has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
STE had positive earnings in the past year.
STE had a positive operating cash flow in the past year.
Each year in the past 5 years STE has been profitable.
Each year in the past 5 years STE had a positive operating cash flow.
1.2 Ratios
STE's Return On Assets of 4.25% is amongst the best of the industry. STE outperforms 81.58% of its industry peers.
The Return On Equity of STE (6.59%) is better than 81.05% of its industry peers.
Looking at the Return On Invested Capital, with a value of 7.22%, STE belongs to the top of the industry, outperforming 85.26% of the companies in the same industry.
STE had an Average Return On Invested Capital over the past 3 years of 5.03%. This is below the industry average of 8.08%.
The 3 year average ROIC (5.03%) for STE is below the current ROIC(7.22%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.25% | ||
| ROE | 6.59% | ||
| ROIC | 7.22% |
ROA(3y)2.18%
ROA(5y)4.02%
ROE(3y)3.83%
ROE(5y)6.74%
ROIC(3y)5.03%
ROIC(5y)5.94%
1.3 Margins
The Profit Margin of STE (8.49%) is better than 80.53% of its industry peers.
STE's Profit Margin has declined in the last couple of years.
The Operating Margin of STE (18.23%) is better than 91.58% of its industry peers.
In the last couple of years the Operating Margin of STE has remained more or less at the same level.
Looking at the Gross Margin, with a value of 43.01%, STE is doing worse than 63.68% of the companies in the same industry.
In the last couple of years the Gross Margin of STE has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.23% | ||
| PM (TTM) | 8.49% | ||
| GM | 43.01% |
OM growth 3Y-0.53%
OM growth 5Y0.96%
PM growth 3Y-16.82%
PM growth 5Y-7.58%
GM growth 3Y-0.04%
GM growth 5Y0.44%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), STE is creating some value.
Compared to 1 year ago, STE has about the same amount of shares outstanding.
The number of shares outstanding for STE has been increased compared to 5 years ago.
Compared to 1 year ago, STE has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 4.77 indicates that STE is not in any danger for bankruptcy at the moment.
STE's Altman-Z score of 4.77 is fine compared to the rest of the industry. STE outperforms 74.74% of its industry peers.
STE has a debt to FCF ratio of 3.29. This is a good value and a sign of high solvency as STE would need 3.29 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 3.29, STE belongs to the best of the industry, outperforming 85.79% of the companies in the same industry.
STE has a Debt/Equity ratio of 0.33. This is a healthy value indicating a solid balance between debt and equity.
STE has a Debt to Equity ratio of 0.33. This is comparable to the rest of the industry: STE outperforms 48.95% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.33 | ||
| Debt/FCF | 3.29 | ||
| Altman-Z | 4.77 |
ROIC/WACC1.09
WACC6.64%
2.3 Liquidity
A Current Ratio of 2.41 indicates that STE has no problem at all paying its short term obligations.
STE has a Current ratio of 2.41. This is comparable to the rest of the industry: STE outperforms 43.16% of its industry peers.
STE has a Quick Ratio of 1.55. This is a normal value and indicates that STE is financially healthy and should not expect problems in meeting its short term obligations.
STE's Quick ratio of 1.55 is in line compared to the rest of the industry. STE outperforms 40.53% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.41 | ||
| Quick Ratio | 1.55 |
3. Growth
3.1 Past
STE shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 8.74%, which is quite good.
STE shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 12.55% yearly.
STE shows a decrease in Revenue. In the last year, the revenue decreased by -2.06%.
Measured over the past years, STE shows a quite strong growth in Revenue. The Revenue has been growing by 13.06% on average per year.
EPS 1Y (TTM)8.74%
EPS 3Y12.81%
EPS 5Y12.55%
EPS Q2Q%5.42%
Revenue 1Y (TTM)-2.06%
Revenue growth 3Y18.25%
Revenue growth 5Y13.06%
Sales Q2Q%-1%
3.2 Future
Based on estimates for the next years, STE will show a small growth in Earnings Per Share. The EPS will grow by 5.10% on average per year.
STE is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.15% yearly.
EPS Next Y3.71%
EPS Next 2Y6.62%
EPS Next 3Y7%
EPS Next 5Y5.1%
Revenue Next Year0.84%
Revenue Next 2Y3.56%
Revenue Next 3Y4.46%
Revenue Next 5Y5.15%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 24.10, which indicates a rather expensive current valuation of STE.
Compared to the rest of the industry, the Price/Earnings ratio of STE indicates a rather cheap valuation: STE is cheaper than 85.79% of the companies listed in the same industry.
STE is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 28.29, which is the current average of the S&P500 Index.
STE is valuated rather expensively with a Price/Forward Earnings ratio of 21.80.
Based on the Price/Forward Earnings ratio, STE is valued cheaply inside the industry as 82.11% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 24.44, STE is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.1 | ||
| Fwd PE | 21.8 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of STE indicates a rather cheap valuation: STE is cheaper than 83.68% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of STE indicates a rather cheap valuation: STE is cheaper than 82.63% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 31.76 | ||
| EV/EBITDA | 16.35 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates STE does not grow enough to justify the current Price/Earnings ratio.
STE has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)6.5
PEG (5Y)1.92
EPS Next 2Y6.62%
EPS Next 3Y7%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.08%, STE has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 1.64, STE pays a better dividend. On top of this STE pays more dividend than 94.74% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.28, STE's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.08% |
5.2 History
On average, the dividend of STE grows each year by 8.90%, which is quite nice.
STE has been paying a dividend for at least 10 years, so it has a reliable track record.
STE has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)8.9%
Div Incr Years19
Div Non Decr Years19
5.3 Sustainability
STE pays out 48.40% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of STE is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP48.4%
EPS Next 2Y6.62%
EPS Next 3Y7%
STERIS PLC
NYSE:STE (1/22/2025, 11:43:18 AM)
218.84
+1.77 (+0.82%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Equipment & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners99.05%
Inst Owner Change-0.18%
Ins Owners0.21%
Ins Owner Change-0.32%
Market Cap21.60B
Analysts78.33
Price Target257.06 (17.46%)
Short Float %1.1%
Short Ratio1.8
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.08% |
Yearly Dividend2.03
Dividend Growth(5Y)8.9%
DP48.4%
Div Incr Years19
Div Non Decr Years19
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)3.47%
Min EPS beat(2)-0.22%
Max EPS beat(2)7.17%
EPS beat(4)3
Avg EPS beat(4)4.24%
Min EPS beat(4)-0.22%
Max EPS beat(4)8.7%
EPS beat(8)6
Avg EPS beat(8)2.56%
EPS beat(12)7
Avg EPS beat(12)2.07%
EPS beat(16)10
Avg EPS beat(16)3.35%
Revenue beat(2)0
Avg Revenue beat(2)-0.78%
Min Revenue beat(2)-1.12%
Max Revenue beat(2)-0.43%
Revenue beat(4)1
Avg Revenue beat(4)0.13%
Min Revenue beat(4)-1.12%
Max Revenue beat(4)2.47%
Revenue beat(8)4
Avg Revenue beat(8)1.31%
Revenue beat(12)6
Avg Revenue beat(12)0.19%
Revenue beat(16)9
Avg Revenue beat(16)0.68%
PT rev (1m)0%
PT rev (3m)1.91%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-2.12%
EPS NY rev (1m)0%
EPS NY rev (3m)-1.03%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.41%
Revenue NY rev (1m)0.02%
Revenue NY rev (3m)-0.13%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.1 | ||
| Fwd PE | 21.8 | ||
| P/S | 4.22 | ||
| P/FCF | 31.76 | ||
| P/OCF | 19.63 | ||
| P/B | 3.28 | ||
| P/tB | 49.28 | ||
| EV/EBITDA | 16.35 |
EPS(TTM)9.08
EY4.15%
EPS(NY)10.04
Fwd EY4.59%
FCF(TTM)6.89
FCFY3.15%
OCF(TTM)11.15
OCFY5.09%
SpS51.87
BVpS66.8
TBVpS4.44
PEG (NY)6.5
PEG (5Y)1.92
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.25% | ||
| ROE | 6.59% | ||
| ROCE | 9.89% | ||
| ROIC | 7.22% | ||
| ROICexc | 7.35% | ||
| ROICexgc | 21.91% | ||
| OM | 18.23% | ||
| PM (TTM) | 8.49% | ||
| GM | 43.01% | ||
| FCFM | 13.28% |
ROA(3y)2.18%
ROA(5y)4.02%
ROE(3y)3.83%
ROE(5y)6.74%
ROIC(3y)5.03%
ROIC(5y)5.94%
ROICexc(3y)5.15%
ROICexc(5y)6.17%
ROICexgc(3y)16.59%
ROICexgc(5y)18.89%
ROCE(3y)6.89%
ROCE(5y)8.13%
ROICexcg growth 3Y-6.92%
ROICexcg growth 5Y-5.42%
ROICexc growth 3Y-1.81%
ROICexc growth 5Y-3.06%
OM growth 3Y-0.53%
OM growth 5Y0.96%
PM growth 3Y-16.82%
PM growth 5Y-7.58%
GM growth 3Y-0.04%
GM growth 5Y0.44%
F-Score6
Asset Turnover0.5
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.33 | ||
| Debt/FCF | 3.29 | ||
| Debt/EBITDA | 1.5 | ||
| Cap/Depr | 83.58% | ||
| Cap/Sales | 8.21% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 76.62% | ||
| Profit Quality | 156.43% | ||
| Current Ratio | 2.41 | ||
| Quick Ratio | 1.55 | ||
| Altman-Z | 4.77 |
F-Score6
WACC6.64%
ROIC/WACC1.09
Cap/Depr(3y)60.41%
Cap/Depr(5y)79.83%
Cap/Sales(3y)6.86%
Cap/Sales(5y)7.07%
Profit Quality(3y)231.32%
Profit Quality(5y)179.91%
High Growth Momentum
Growth
EPS 1Y (TTM)8.74%
EPS 3Y12.81%
EPS 5Y12.55%
EPS Q2Q%5.42%
EPS Next Y3.71%
EPS Next 2Y6.62%
EPS Next 3Y7%
EPS Next 5Y5.1%
Revenue 1Y (TTM)-2.06%
Revenue growth 3Y18.25%
Revenue growth 5Y13.06%
Sales Q2Q%-1%
Revenue Next Year0.84%
Revenue Next 2Y3.56%
Revenue Next 3Y4.46%
Revenue Next 5Y5.15%
EBIT growth 1Y13.73%
EBIT growth 3Y17.62%
EBIT growth 5Y14.14%
EBIT Next Year34.67%
EBIT Next 3Y12.15%
EBIT Next 5Y11.75%
FCF growth 1Y70.59%
FCF growth 3Y10.83%
FCF growth 5Y11.87%
OCF growth 1Y46.43%
OCF growth 3Y12.17%
OCF growth 5Y12.52%