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SOTERA HEALTH CO (SHC) Stock Fundamental Analysis

NASDAQ:SHC - Nasdaq - US83601L1026 - Common Stock - Currency: USD

11.24  +0.15 (+1.35%)

After market: 11.24 0 (0%)

Fundamental Rating

5

Taking everything into account, SHC scores 5 out of 10 in our fundamental rating. SHC was compared to 55 industry peers in the Life Sciences Tools & Services industry. While SHC belongs to the best of the industry regarding profitability, there are concerns on its financial health. SHC has a decent growth rate and is not valued too expensively.


Dividend Valuation Growth Profitability Health

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7

1. Profitability

1.1 Basic Checks

SHC had positive earnings in the past year.
In the past year SHC had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: SHC reported negative net income in multiple years.
Of the past 5 years SHC 4 years had a positive operating cash flow.
SHC Yearly Net Income VS EBIT VS OCF VS FCFSHC Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2018 2019 2020 2021 2022 2023 2024 0 200M -200M

1.2 Ratios

With a decent Return On Assets value of 1.00%, SHC is doing good in the industry, outperforming 69.09% of the companies in the same industry.
Looking at the Return On Equity, with a value of 7.51%, SHC is in the better half of the industry, outperforming 80.00% of the companies in the same industry.
The Return On Invested Capital of SHC (9.76%) is better than 83.64% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for SHC is significantly below the industry average of 13.60%.
The 3 year average ROIC (8.04%) for SHC is below the current ROIC(9.76%), indicating increased profibility in the last year.
Industry RankSector Rank
ROA 1%
ROE 7.51%
ROIC 9.76%
ROA(3y)-1.47%
ROA(5y)-0.34%
ROE(3y)-14.75%
ROE(5y)-6.62%
ROIC(3y)8.04%
ROIC(5y)7.61%
SHC Yearly ROA, ROE, ROICSHC Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2018 2019 2020 2021 2022 2023 2024 0 -20 -40 -60

1.3 Margins

SHC has a Profit Margin of 2.29%. This is in the better half of the industry: SHC outperforms 69.09% of its industry peers.
SHC's Profit Margin has declined in the last couple of years.
With an excellent Operating Margin value of 26.18%, SHC belongs to the best of the industry, outperforming 96.36% of the companies in the same industry.
In the last couple of years the Operating Margin of SHC has grown nicely.
SHC has a better Gross Margin (54.45%) than 65.45% of its industry peers.
SHC's Gross Margin has improved in the last couple of years.
Industry RankSector Rank
OM 26.18%
PM (TTM) 2.29%
GM 54.45%
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%
SHC Yearly Profit, Operating, Gross MarginsSHC Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2018 2019 2020 2021 2022 2023 2024 0 20 -20 40

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3

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so SHC is destroying value.
SHC has more shares outstanding than it did 1 year ago.
SHC has more shares outstanding than it did 5 years ago.
SHC has a worse debt/assets ratio than last year.
SHC Yearly Shares OutstandingSHC Yearly Shares OutstandingYearly Shares Outstanding 2018 2019 2020 2021 2022 2023 2024 50M 100M 150M 200M 250M
SHC Yearly Total Debt VS Total AssetsSHC Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2018 2019 2020 2021 2022 2023 2024 1B 2B 3B

2.2 Solvency

SHC has an Altman-Z score of 1.37. This is a bad value and indicates that SHC is not financially healthy and even has some risk of bankruptcy.
With a Altman-Z score value of 1.37, SHC is not doing good in the industry: 60.00% of the companies in the same industry are doing better.
The Debt to FCF ratio of SHC is 21.89, which is on the high side as it means it would take SHC, 21.89 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of SHC (21.89) is comparable to the rest of the industry.
SHC has a Debt/Equity ratio of 5.55. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of SHC (5.55) is worse than 90.91% of its industry peers.
Industry RankSector Rank
Debt/Equity 5.55
Debt/FCF 21.89
Altman-Z 1.37
ROIC/WACC0.94
WACC10.4%
SHC Yearly LT Debt VS Equity VS FCFSHC Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2018 2019 2020 2021 2022 2023 2024 0 1B 2B

2.3 Liquidity

SHC has a Current Ratio of 2.46. This indicates that SHC is financially healthy and has no problem in meeting its short term obligations.
SHC has a Current ratio (2.46) which is in line with its industry peers.
SHC has a Quick Ratio of 2.19. This indicates that SHC is financially healthy and has no problem in meeting its short term obligations.
The Quick ratio of SHC (2.19) is comparable to the rest of the industry.
Industry RankSector Rank
Current Ratio 2.46
Quick Ratio 2.19
SHC Yearly Current Assets VS Current LiabilitesSHC Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2018 2019 2020 2021 2022 2023 2024 200M 400M 600M

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4

3. Growth

3.1 Past

The earnings per share for SHC have decreased strongly by -12.35% in the last year.
Measured over the past years, SHC shows a decrease in Earnings Per Share. The EPS has been decreasing by -7.34% on average per year.
Looking at the last year, SHC shows a very strong growth in Revenue. The Revenue has grown by 25.82%.
The Revenue has been growing slightly by 7.17% on average over the past years.
EPS 1Y (TTM)-12.35%
EPS 3Y-7.34%
EPS 5YN/A
EPS Q2Q%7.69%
Revenue 1Y (TTM)25.82%
Revenue growth 3Y5.71%
Revenue growth 5Y7.17%
Sales Q2Q%2.56%

3.2 Future

The Earnings Per Share is expected to grow by 12.75% on average over the next years. This is quite good.
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 Y7.93%
EPS Next 2Y10.82%
EPS Next 3Y10.95%
EPS Next 5Y12.75%
Revenue Next Year3.69%
Revenue Next 2Y4.79%
Revenue Next 3Y5.32%
Revenue Next 5Y6.85%

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
SHC Yearly Revenue VS EstimatesSHC Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 500M 1B 1.5B
SHC Yearly EPS VS EstimatesSHC Yearly EPS VS EstimatesYearly EPS VS Estimates 2020 2021 2022 2023 2024 2025 2026 2027 2028 0.2 0.4 0.6 0.8 1

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6

4. Valuation

4.1 Price/Earnings Ratio

SHC is valuated correctly with a Price/Earnings ratio of 15.83.
Compared to the rest of the industry, the Price/Earnings ratio of SHC indicates a rather cheap valuation: SHC is cheaper than 89.09% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 26.92. SHC is valued slightly cheaper when compared to this.
The Price/Forward Earnings ratio is 13.08, which indicates a correct valuation of SHC.
Based on the Price/Forward Earnings ratio, SHC is valued cheaply inside the industry as 90.91% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.46, SHC is valued a bit cheaper.
Industry RankSector Rank
PE 15.83
Fwd PE 13.08
SHC Price Earnings VS Forward Price EarningsSHC Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60 80

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, SHC is valued cheaper than 98.18% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, SHC is valued a bit cheaper than the industry average as 69.09% of the companies are valued more expensively.
Industry RankSector Rank
P/FCF 30.13
EV/EBITDA 10.03
SHC Per share dataSHC EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 2 -2 4

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates SHC does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of SHC may justify a higher PE ratio.
PEG (NY)2
PEG (5Y)N/A
EPS Next 2Y10.82%
EPS Next 3Y10.95%

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0

5. Dividend

5.1 Amount

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

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SOTERA HEALTH CO

NASDAQ:SHC (6/24/2025, 8:00:02 PM)

After market: 11.24 0 (0%)

11.24

+0.15 (+1.35%)

Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryLife Sciences Tools & Services
Earnings (Last)05-01 2025-05-01/bmo
Earnings (Next)08-04 2025-08-04/bmo
Inst Owners50.34%
Inst Owner Change2.22%
Ins Owners2.51%
Ins Owner Change15.67%
Market Cap3.19B
Analysts80
Price Target15.13 (34.61%)
Short Float %8.47%
Short Ratio9.67
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.41%
Min EPS beat(2)3.1%
Max EPS beat(2)13.73%
EPS beat(4)3
Avg EPS beat(4)5.75%
Min EPS beat(4)-8.09%
Max EPS beat(4)14.27%
EPS beat(8)6
Avg EPS beat(8)6.22%
EPS beat(12)9
Avg EPS beat(12)5.77%
EPS beat(16)13
Avg EPS beat(16)6.86%
Revenue beat(2)1
Avg Revenue beat(2)0.65%
Min Revenue beat(2)-1.22%
Max Revenue beat(2)2.53%
Revenue beat(4)2
Avg Revenue beat(4)-2.22%
Min Revenue beat(4)-11.65%
Max Revenue beat(4)2.53%
Revenue beat(8)4
Avg Revenue beat(8)-1.32%
Revenue beat(12)6
Avg Revenue beat(12)-0.75%
Revenue beat(16)10
Avg Revenue beat(16)0.3%
PT rev (1m)-2.04%
PT rev (3m)-5.45%
EPS NQ rev (1m)-0.51%
EPS NQ rev (3m)-5.89%
EPS NY rev (1m)-0.2%
EPS NY rev (3m)-4.66%
Revenue NQ rev (1m)-0.11%
Revenue NQ rev (3m)-1.83%
Revenue NY rev (1m)-0.09%
Revenue NY rev (3m)0.61%
Valuation
Industry RankSector Rank
PE 15.83
Fwd PE 13.08
P/S 2.35
P/FCF 30.13
P/OCF 11.82
P/B 7.71
P/tB N/A
EV/EBITDA 10.03
EPS(TTM)0.71
EY6.32%
EPS(NY)0.86
Fwd EY7.65%
FCF(TTM)0.37
FCFY3.32%
OCF(TTM)0.95
OCFY8.46%
SpS4.77
BVpS1.46
TBVpS-3.4
PEG (NY)2
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 1%
ROE 7.51%
ROCE 12.35%
ROIC 9.76%
ROICexc 10.91%
ROICexgc 23.57%
OM 26.18%
PM (TTM) 2.29%
GM 54.45%
FCFM 7.81%
ROA(3y)-1.47%
ROA(5y)-0.34%
ROE(3y)-14.75%
ROE(5y)-6.62%
ROIC(3y)8.04%
ROIC(5y)7.61%
ROICexc(3y)9.2%
ROICexc(5y)8.42%
ROICexgc(3y)32.15%
ROICexgc(5y)28.54%
ROCE(3y)10.18%
ROCE(5y)9.64%
ROICexcg growth 3Y-8.13%
ROICexcg growth 5Y-2.77%
ROICexc growth 3Y3.93%
ROICexc growth 5Y7.64%
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%
F-Score5
Asset Turnover0.44
Health
Industry RankSector Rank
Debt/Equity 5.55
Debt/FCF 21.89
Debt/EBITDA 4.43
Cap/Depr 100.05%
Cap/Sales 12.11%
Interest Coverage 2.25
Cash Conversion 52.05%
Profit Quality 340.71%
Current Ratio 2.46
Quick Ratio 2.19
Altman-Z 1.37
F-Score5
WACC10.4%
ROIC/WACC0.94
Cap/Depr(3y)123.61%
Cap/Depr(5y)95.16%
Cap/Sales(3y)18.31%
Cap/Sales(5y)14.49%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-12.35%
EPS 3Y-7.34%
EPS 5YN/A
EPS Q2Q%7.69%
EPS Next Y7.93%
EPS Next 2Y10.82%
EPS Next 3Y10.95%
EPS Next 5Y12.75%
Revenue 1Y (TTM)25.82%
Revenue growth 3Y5.71%
Revenue growth 5Y7.17%
Sales Q2Q%2.56%
Revenue Next Year3.69%
Revenue Next 2Y4.79%
Revenue Next 3Y5.32%
Revenue Next 5Y6.85%
EBIT growth 1Y19.62%
EBIT growth 3Y5.04%
EBIT growth 5Y9.46%
EBIT Next Year25.83%
EBIT Next 3Y12.69%
EBIT Next 5Y11.52%
FCF growth 1Y51.27%
FCF growth 3Y-36.88%
FCF growth 5Y-13.23%
OCF growth 1Y3.09%
OCF growth 3Y-7.31%
OCF growth 5Y8.51%