SMITH & NEPHEW PLC -SPON ADR (SNN) Stock Fundamental Analysis
NYSE:SNN - New York Stock Exchange, Inc. - US83175M2052 - ADR - Currency: USD
We assign a fundamental rating of 6 out of 10 to SNN. SNN was compared to 187 industry peers in the Health Care Equipment & Supplies industry. SNN has an excellent profitability rating, but there are some minor concerns on its financial health. SNN is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
SNN had positive earnings in the past year.
SNN had a positive operating cash flow in the past year.
In the past 5 years SNN has always been profitable.
In the past 5 years SNN always reported a positive cash flow from operatings.
1.2 Ratios
SNN has a Return On Assets of 4.59%. This is amongst the best in the industry. SNN outperforms 80.75% of its industry peers.
With an excellent Return On Equity value of 8.87%, SNN belongs to the best of the industry, outperforming 82.35% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 8.43%, SNN belongs to the top of the industry, outperforming 88.24% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for SNN is in line with the industry average of 8.03%.
The 3 year average ROIC (7.67%) for SNN is below the current ROIC(8.43%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.59% | ||
| ROE | 8.87% | ||
| ROIC | 8.43% |
ROA(3y)2.95%
ROA(5y)3.54%
ROE(3y)5.7%
ROE(5y)7%
ROIC(3y)7.67%
ROIC(5y)6.98%
1.3 Margins
SNN's Profit Margin of 8.26% is amongst the best of the industry. SNN outperforms 80.21% of its industry peers.
SNN's Profit Margin has declined in the last couple of years.
SNN has a better Operating Margin (14.99%) than 85.03% of its industry peers.
In the last couple of years the Operating Margin of SNN has declined.
With an excellent Gross Margin value of 70.04%, SNN belongs to the best of the industry, outperforming 80.21% of the companies in the same industry.
In the last couple of years the Gross Margin of SNN has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.99% | ||
| PM (TTM) | 8.26% | ||
| GM | 70.04% |
OM growth 3Y3.51%
OM growth 5Y-5.16%
PM growth 3Y-10.98%
PM growth 5Y-9.49%
GM growth 3Y-0.41%
GM growth 5Y-1.1%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), SNN is creating some value.
SNN has about the same amout of shares outstanding than it did 1 year ago.
The number of shares outstanding for SNN remains at a similar level compared to 5 years ago.
The debt/assets ratio for SNN is higher compared to a year ago.
2.2 Solvency
SNN has an Altman-Z score of 3.64. This indicates that SNN is financially healthy and has little risk of bankruptcy at the moment.
SNN has a Altman-Z score of 3.64. This is in the better half of the industry: SNN outperforms 72.73% of its industry peers.
The Debt to FCF ratio of SNN is 4.33, which is a neutral value as it means it would take SNN, 4.33 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of SNN (4.33) is better than 82.89% of its industry peers.
SNN has a Debt/Equity ratio of 0.60. This is a neutral value indicating SNN is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.60, SNN is not doing good in the industry: 68.98% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.6 | ||
| Debt/FCF | 4.33 | ||
| Altman-Z | 3.64 |
ROIC/WACC1
WACC8.4%
2.3 Liquidity
SNN has a Current Ratio of 3.00. This indicates that SNN is financially healthy and has no problem in meeting its short term obligations.
Looking at the Current ratio, with a value of 3.00, SNN is in line with its industry, outperforming 56.68% of the companies in the same industry.
A Quick Ratio of 1.40 indicates that SNN should not have too much problems paying its short term obligations.
SNN's Quick ratio of 1.40 is on the low side compared to the rest of the industry. SNN is outperformed by 63.10% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3 | ||
| Quick Ratio | 1.4 |
3. Growth
3.1 Past
SNN shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 59.86%, which is quite impressive.
Measured over the past years, SNN shows a decrease in Earnings Per Share. The EPS has been decreasing by -7.22% on average per year.
SNN shows a small growth in Revenue. In the last year, the Revenue has grown by 5.35%.
Measured over the past years, SNN shows a small growth in Revenue. The Revenue has been growing by 2.49% on average per year.
EPS 1Y (TTM)59.86%
EPS 3Y-7.63%
EPS 5Y-7.22%
EPS Q2Q%35.92%
Revenue 1Y (TTM)5.35%
Revenue growth 3Y3.69%
Revenue growth 5Y2.49%
Sales Q2Q%4.74%
3.2 Future
SNN is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 11.76% yearly.
Based on estimates for the next years, SNN will show a small growth in Revenue. The Revenue will grow by 5.45% on average per year.
EPS Next Y16.67%
EPS Next 2Y14.9%
EPS Next 3Y11.11%
EPS Next 5Y11.76%
Revenue Next Year5.98%
Revenue Next 2Y5.67%
Revenue Next 3Y5.46%
Revenue Next 5Y5.45%
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 accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 32.36 indicates a quite expensive valuation of SNN.
SNN's Price/Earnings ratio is a bit cheaper when compared to the industry. SNN is cheaper than 72.73% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 26.41, SNN is valued a bit more expensive.
A Price/Forward Earnings ratio of 15.05 indicates a correct valuation of SNN.
SNN's Price/Forward Earnings ratio is rather cheap when compared to the industry. SNN is cheaper than 83.96% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of SNN to the average of the S&P500 Index (33.87), we can say SNN is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 32.36 | ||
| Fwd PE | 15.05 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SNN indicates a rather cheap valuation: SNN is cheaper than 85.03% of the companies listed in the same industry.
SNN's Price/Free Cash Flow ratio is rather cheap when compared to the industry. SNN is cheaper than 87.17% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.89 | ||
| EV/EBITDA | 12.04 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
SNN has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)1.94
PEG (5Y)N/A
EPS Next 2Y14.9%
EPS Next 3Y11.11%
5. Dividend
5.1 Amount
SNN has a Yearly Dividend Yield of 2.11%.
Compared to an average industry Dividend Yield of 1.80, SNN pays a better dividend. On top of this SNN pays more dividend than 96.26% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.39, SNN has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.11% |
5.2 History
The dividend of SNN has a limited annual growth rate of 0.55%.
SNN has been paying a dividend for at least 10 years, so it has a reliable track record.
SNN has decreased its dividend in the last 3 years.
Dividend Growth(5Y)0.55%
Div Incr Years1
Div Non Decr Years2
5.3 Sustainability
SNN pays out 66.60% of its income as dividend. This is not a sustainable payout ratio.
The dividend of SNN is growing, but earnings are growing more, so the dividend growth is sustainable.
DP66.6%
EPS Next 2Y14.9%
EPS Next 3Y11.11%
NYSE:SNN (8/12/2025, 12:45:23 PM)
36.24
+0.28 (+0.78%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Equipment & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners67.14%
Inst Owner Change14.17%
Ins Owners0.12%
Ins Owner ChangeN/A
Market Cap15.86B
Analysts74.4
Price Target34.26 (-5.46%)
Short Float %0.62%
Short Ratio2.99
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.11% |
Yearly Dividend0.37
Dividend Growth(5Y)0.55%
DP66.6%
Div Incr Years1
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0.48%
PT rev (3m)1.62%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)0%
EPS NY rev (3m)0%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)0.53%
Revenue NY rev (3m)0.53%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 32.36 | ||
| Fwd PE | 15.05 | ||
| P/S | 2.67 | ||
| P/FCF | 19.89 | ||
| P/OCF | 13.85 | ||
| P/B | 2.86 | ||
| P/tB | 10.84 | ||
| EV/EBITDA | 12.04 |
EPS(TTM)1.12
EY3.09%
EPS(NY)2.41
Fwd EY6.65%
FCF(TTM)1.82
FCFY5.03%
OCF(TTM)2.62
OCFY7.22%
SpS13.59
BVpS12.65
TBVpS3.34
PEG (NY)1.94
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.59% | ||
| ROE | 8.87% | ||
| ROCE | 9.74% | ||
| ROIC | 8.43% | ||
| ROICexc | 9.1% | ||
| ROICexgc | 17.48% | ||
| OM | 14.99% | ||
| PM (TTM) | 8.26% | ||
| GM | 70.04% | ||
| FCFM | 13.41% |
ROA(3y)2.95%
ROA(5y)3.54%
ROE(3y)5.7%
ROE(5y)7%
ROIC(3y)7.67%
ROIC(5y)6.98%
ROICexc(3y)8.09%
ROICexc(5y)7.69%
ROICexgc(3y)16.87%
ROICexgc(5y)16.94%
ROCE(3y)8.97%
ROCE(5y)8.12%
ROICexcg growth 3Y-2.43%
ROICexcg growth 5Y-8.17%
ROICexc growth 3Y4.17%
ROICexc growth 5Y-4.59%
OM growth 3Y3.51%
OM growth 5Y-5.16%
PM growth 3Y-10.98%
PM growth 5Y-9.49%
GM growth 3Y-0.41%
GM growth 5Y-1.1%
F-Score8
Asset Turnover0.56
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.6 | ||
| Debt/FCF | 4.33 | ||
| Debt/EBITDA | 2.16 | ||
| Cap/Depr | 53.95% | ||
| Cap/Sales | 5.85% | ||
| Interest Coverage | 5.94 | ||
| Cash Conversion | 74.54% | ||
| Profit Quality | 162.32% | ||
| Current Ratio | 3 | ||
| Quick Ratio | 1.4 | ||
| Altman-Z | 3.64 |
F-Score8
WACC8.4%
ROIC/WACC1
Cap/Depr(3y)59.87%
Cap/Depr(5y)66.08%
Cap/Sales(3y)7.04%
Cap/Sales(5y)7.73%
Profit Quality(3y)88.41%
Profit Quality(5y)92.91%
High Growth Momentum
Growth
EPS 1Y (TTM)59.86%
EPS 3Y-7.63%
EPS 5Y-7.22%
EPS Q2Q%35.92%
EPS Next Y16.67%
EPS Next 2Y14.9%
EPS Next 3Y11.11%
EPS Next 5Y11.76%
Revenue 1Y (TTM)5.35%
Revenue growth 3Y3.69%
Revenue growth 5Y2.49%
Sales Q2Q%4.74%
Revenue Next Year5.98%
Revenue Next 2Y5.67%
Revenue Next 3Y5.46%
Revenue Next 5Y5.45%
EBIT growth 1Y28.02%
EBIT growth 3Y7.32%
EBIT growth 5Y-2.8%
EBIT Next Year72.38%
EBIT Next 3Y25.75%
EBIT Next 5Y17.73%
FCF growth 1Y3522.73%
FCF growth 3Y8.92%
FCF growth 5Y-4.43%
OCF growth 1Y206.15%
OCF growth 3Y4.02%
OCF growth 5Y-3.31%