STERIS PLC (STE) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:STE - IE00BFY8C754 - Common Stock
265.985 USD
+2.86 (+1.09%)
STE gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 184 industry peers in the Health Care Equipment & Supplies industry. Both the health and profitability get an excellent rating, making STE a very profitable company, without any liquidiy or solvency issues. STE is not valued too expensively and it also shows a decent growth rate. These ratings would make STE suitable for quality investing!
1. Profitability
1.1 Basic Checks
- In the past year STE was profitable.
- STE had a positive operating cash flow in the past year.
- In the past 5 years STE has always been profitable.
- Each year in the past 5 years STE had a positive operating cash flow.
1.2 Ratios
- With an excellent Return On Assets value of 6.61%, STE belongs to the best of the industry, outperforming 87.50% of the companies in the same industry.
- Looking at the Return On Equity, with a value of 9.82%, STE belongs to the top of the industry, outperforming 86.41% of the companies in the same industry.
- The Return On Invested Capital of STE (8.58%) is better than 87.50% of its industry peers.
- STE had an Average Return On Invested Capital over the past 3 years of 7.07%. This is in line with the industry average of 8.81%.
- The last Return On Invested Capital (8.58%) for STE is above the 3 year average (7.07%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.61% | ||
| ROE | 9.82% | ||
| ROIC | 8.58% |
ROA(3y)3.49%
ROA(5y)3.73%
ROE(3y)5.69%
ROE(5y)6.21%
ROIC(3y)7.07%
ROIC(5y)6.29%
1.3 Margins
- STE has a better Profit Margin (12.07%) than 88.04% of its industry peers.
- In the last couple of years the Profit Margin of STE has declined.
- STE has a Operating Margin of 18.42%. This is amongst the best in the industry. STE outperforms 90.76% of its industry peers.
- In the last couple of years the Operating Margin of STE has remained more or less at the same level.
- STE has a worse Gross Margin (44.29%) than 63.04% of its industry peers.
- 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 | 18.42% | ||
| PM (TTM) | 12.07% | ||
| GM | 44.29% |
OM growth 3Y24.25%
OM growth 5Y0.07%
PM growth 3Y28.39%
PM growth 5Y-3.5%
GM growth 3Y0.03%
GM growth 5Y0.21%
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.
- The number of shares outstanding for STE has been reduced compared to 1 year ago.
- STE has more shares outstanding than it did 5 years ago.
- The debt/assets ratio for STE has been reduced compared to a year ago.
2.2 Solvency
- STE has an Altman-Z score of 5.94. This indicates that STE is financially healthy and has little risk of bankruptcy at the moment.
- The Altman-Z score of STE (5.94) is better than 80.98% of its industry peers.
- The Debt to FCF ratio of STE is 1.97, which is an excellent value as it means it would take STE, only 1.97 years of fcf income to pay off all of its debts.
- STE's Debt to FCF ratio of 1.97 is amongst the best of the industry. STE outperforms 86.96% of its industry peers.
- STE has a Debt/Equity ratio of 0.27. This is a healthy value indicating a solid balance between debt and equity.
- With a Debt to Equity ratio value of 0.27, STE perfoms like the industry average, outperforming 52.72% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.27 | ||
| Debt/FCF | 1.97 | ||
| Altman-Z | 5.94 |
ROIC/WACC1.19
WACC7.19%
2.3 Liquidity
- A Current Ratio of 2.37 indicates that STE has no problem at all paying its short term obligations.
- STE has a Current ratio of 2.37. This is comparable to the rest of the industry: STE outperforms 45.11% of its industry peers.
- A Quick Ratio of 1.63 indicates that STE should not have too much problems paying its short term obligations.
- STE's Quick ratio of 1.63 is in line compared to the rest of the industry. STE outperforms 45.65% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.37 | ||
| Quick Ratio | 1.63 |
3. Growth
3.1 Past
- STE shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 8.70%, which is quite good.
- Measured over the past years, STE shows a quite strong growth in Earnings Per Share. The EPS has been growing by 10.61% on average per year.
- Looking at the last year, STE shows a quite strong growth in Revenue. The Revenue has grown by 11.37% in the last year.
- STE shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 12.49% yearly.
EPS 1Y (TTM)8.7%
EPS 3Y5.7%
EPS 5Y10.61%
EPS Q2Q%15.42%
Revenue 1Y (TTM)11.37%
Revenue growth 3Y5.99%
Revenue growth 5Y12.49%
Sales Q2Q%9.89%
3.2 Future
- The Earnings Per Share is expected to grow by 7.43% on average over the next years.
- The Revenue is expected to grow by 6.62% on average over the next years.
EPS Next Y10.36%
EPS Next 2Y9.72%
EPS Next 3Y9.74%
EPS Next 5Y7.43%
Revenue Next Year8.72%
Revenue Next 2Y7.47%
Revenue Next 3Y7.35%
Revenue Next 5Y6.62%
3.3 Evolution
- The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 26.95, STE can be considered very expensive at the moment.
- Based on the Price/Earnings ratio, STE is valued a bit cheaper than the industry average as 78.26% of the companies are valued more expensively.
- Compared to an average S&P500 Price/Earnings ratio of 27.25, STE is valued at the same level.
- STE is valuated rather expensively with a Price/Forward Earnings ratio of 23.65.
- Based on the Price/Forward Earnings ratio, STE is valued a bit cheaper than 78.26% of the companies in the same industry.
- STE's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 25.98.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.95 | ||
| Fwd PE | 23.65 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, STE is valued a bit cheaper than 79.35% of the companies 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 82.61% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 27.16 | ||
| EV/EBITDA | 17.8 |
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.
- The decent profitability rating of STE may justify a higher PE ratio.
PEG (NY)2.6
PEG (5Y)2.54
EPS Next 2Y9.72%
EPS Next 3Y9.74%
5. Dividend
5.1 Amount
- STE has a yearly dividend return of 0.97%, which is pretty low.
- Compared to an average industry Dividend Yield of 0.20, STE pays a better dividend. On top of this STE pays more dividend than 92.93% of the companies listed in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.82, STE's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.97% |
5.2 History
- On average, the dividend of STE grows each year by 9.04%, 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)9.04%
Div Incr Years19
Div Non Decr Years19
5.3 Sustainability
- STE pays out 33.45% of its income as dividend. This is a sustainable payout ratio.
- STE's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP33.45%
EPS Next 2Y9.72%
EPS Next 3Y9.74%
STERIS PLC / STE FAQ
Can you provide the ChartMill fundamental rating for STERIS PLC?
ChartMill assigns a fundamental rating of 6 / 10 to STE.
What is the valuation status of STERIS PLC (STE) stock?
ChartMill assigns a valuation rating of 4 / 10 to STERIS PLC (STE). This can be considered as Fairly Valued.
How profitable is STERIS PLC (STE) stock?
STERIS PLC (STE) has a profitability rating of 7 / 10.
How financially healthy is STERIS PLC?
The financial health rating of STERIS PLC (STE) is 7 / 10.
Can you provide the expected EPS growth for STE stock?
The Earnings per Share (EPS) of STERIS PLC (STE) is expected to grow by 10.36% in the next year.