STRYKER CORP (SYK) Stock Fundamental Analysis
NYSE:SYK - New York Stock Exchange, Inc. - US8636671013 - Common Stock - Currency: USD
We assign a fundamental rating of 6 out of 10 to SYK. SYK was compared to 187 industry peers in the Health Care Equipment & Supplies industry. While SYK belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. SYK is not overvalued while it is showing excellent growth. This is an interesting combination.
1. Profitability
1.1 Basic Checks
In the past year SYK was profitable.
In the past year SYK had a positive cash flow from operations.
SYK had positive earnings in each of the past 5 years.
SYK had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With an excellent Return On Assets value of 6.21%, SYK belongs to the best of the industry, outperforming 87.17% of the companies in the same industry.
The Return On Equity of SYK (13.66%) is better than 90.37% of its industry peers.
SYK's Return On Invested Capital of 11.71% is amongst the best of the industry. SYK outperforms 93.58% of its industry peers.
The Average Return On Invested Capital over the past 3 years for SYK is above the industry average of 7.89%.
The 3 year average ROIC (11.52%) for SYK is below the current ROIC(11.71%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.21% | ||
| ROE | 13.66% | ||
| ROIC | 11.71% |
ROA(3y)7.1%
ROA(5y)6.34%
ROE(3y)15.24%
ROE(5y)14.27%
ROIC(3y)11.52%
ROIC(5y)10.64%
1.3 Margins
The Profit Margin of SYK (12.31%) is better than 89.84% of its industry peers.
SYK's Profit Margin has been stable in the last couple of years.
SYK's Operating Margin of 22.35% is amongst the best of the industry. SYK outperforms 93.58% of its industry peers.
In the last couple of years the Operating Margin of SYK has remained more or less at the same level.
Looking at the Gross Margin, with a value of 64.57%, SYK is in the better half of the industry, outperforming 66.84% of the companies in the same industry.
In the last couple of years the Gross Margin of SYK has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.35% | ||
| PM (TTM) | 12.31% | ||
| GM | 64.57% |
OM growth 3Y2.95%
OM growth 5Y-0.35%
PM growth 3Y4.36%
PM growth 5Y-1.09%
GM growth 3Y-0.02%
GM growth 5Y-0.49%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), SYK is creating some value.
The number of shares outstanding for SYK has been increased compared to 1 year ago.
Compared to 5 years ago, SYK has more shares outstanding
SYK has a better debt/assets ratio than last year.
2.2 Solvency
SYK has an Altman-Z score of 5.02. This indicates that SYK is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 5.02, SYK is doing good in the industry, outperforming 75.40% of the companies in the same industry.
SYK has a debt to FCF ratio of 4.69. This is a neutral value as SYK would need 4.69 years to pay back of all of its debts.
SYK has a Debt to FCF ratio of 4.69. This is amongst the best in the industry. SYK outperforms 82.35% of its industry peers.
SYK has a Debt/Equity ratio of 0.69. This is a neutral value indicating SYK is somewhat dependend on debt financing.
SYK's Debt to Equity ratio of 0.69 is on the low side compared to the rest of the industry. SYK is outperformed by 69.52% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.69 | ||
| Debt/FCF | 4.69 | ||
| Altman-Z | 5.02 |
ROIC/WACC1.38
WACC8.47%
2.3 Liquidity
SYK has a Current Ratio of 1.64. This is a normal value and indicates that SYK is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.64, SYK is doing worse than 72.19% of the companies in the same industry.
SYK has a Quick Ratio of 1.64. This is a bad value and indicates that SYK is not financially healthy enough and could expect problems in meeting its short term obligations.
SYK's Quick ratio of 1.00 is on the low side compared to the rest of the industry. SYK is outperformed by 76.47% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.64 | ||
| Quick Ratio | 1 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 14.32% over the past year.
The Earnings Per Share has been growing by 8.09% on average over the past years. This is quite good.
SYK shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 10.76%.
Measured over the past years, SYK shows a quite strong growth in Revenue. The Revenue has been growing by 8.71% on average per year.
EPS 1Y (TTM)14.32%
EPS 3Y10.28%
EPS 5Y8.09%
EPS Q2Q%13.6%
Revenue 1Y (TTM)10.76%
Revenue growth 3Y9.72%
Revenue growth 5Y8.71%
Sales Q2Q%11.88%
3.2 Future
SYK is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.96% yearly.
The Revenue is expected to grow by 8.20% on average over the next years. This is quite good.
EPS Next Y10.57%
EPS Next 2Y10.78%
EPS Next 3Y11.11%
EPS Next 5Y9.96%
Revenue Next Year9.63%
Revenue Next 2Y8.99%
Revenue Next 3Y8.77%
Revenue Next 5Y8.2%
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.
4. Valuation
4.1 Price/Earnings Ratio
SYK is valuated quite expensively with a Price/Earnings ratio of 29.97.
73.26% of the companies in the same industry are more expensive than SYK, based on the Price/Earnings ratio.
SYK's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 26.35.
Based on the Price/Forward Earnings ratio of 25.10, the valuation of SYK can be described as expensive.
Based on the Price/Forward Earnings ratio, SYK is valued a bit cheaper than the industry average as 72.19% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.19, SYK is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.97 | ||
| Fwd PE | 25.1 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, SYK is valued a bit cheaper than the industry average as 71.12% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, SYK is valued a bit cheaper than the industry average as 77.01% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 40.12 | ||
| EV/EBITDA | 25.24 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of SYK may justify a higher PE ratio.
PEG (NY)2.84
PEG (5Y)3.7
EPS Next 2Y10.78%
EPS Next 3Y11.11%
5. Dividend
5.1 Amount
SYK has a yearly dividend return of 0.90%, which is pretty low.
Compared to an average industry Dividend Yield of 1.85, SYK pays a better dividend. On top of this SYK pays more dividend than 92.51% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.42, SYK's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.9% |
5.2 History
On average, the dividend of SYK grows each year by 9.04%, which is quite nice.
SYK has paid a dividend for at least 10 years, which is a reliable track record.
SYK 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 Years15
Div Non Decr Years15
5.3 Sustainability
43.20% of the earnings are spent on dividend by SYK. This is a bit on the high side, but may be sustainable.
SYK's earnings are growing around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP43.2%
EPS Next 2Y10.78%
EPS Next 3Y11.11%
375.56
+2.3 (+0.62%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Equipment & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners80.81%
Inst Owner Change2.01%
Ins Owners0.11%
Ins Owner Change4.36%
Market Cap143.52B
Analysts80
Price Target434.44 (15.68%)
Short Float %1.38%
Short Ratio3.38
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.9% |
Yearly Dividend3.2
Dividend Growth(5Y)9.04%
DP43.2%
Div Incr Years15
Div Non Decr Years15
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.36%
Min EPS beat(2)2.54%
Max EPS beat(2)4.19%
EPS beat(4)3
Avg EPS beat(4)2.25%
Min EPS beat(4)-0.26%
Max EPS beat(4)4.19%
EPS beat(8)7
Avg EPS beat(8)3.09%
EPS beat(12)9
Avg EPS beat(12)2.27%
EPS beat(16)11
Avg EPS beat(16)1.63%
Revenue beat(2)2
Avg Revenue beat(2)1%
Min Revenue beat(2)0.17%
Max Revenue beat(2)1.82%
Revenue beat(4)3
Avg Revenue beat(4)0.63%
Min Revenue beat(4)-0.7%
Max Revenue beat(4)1.82%
Revenue beat(8)6
Avg Revenue beat(8)1.19%
Revenue beat(12)8
Avg Revenue beat(12)1.23%
Revenue beat(16)11
Avg Revenue beat(16)1%
PT rev (1m)-0.68%
PT rev (3m)-0.71%
EPS NQ rev (1m)0.04%
EPS NQ rev (3m)-1.69%
EPS NY rev (1m)0.02%
EPS NY rev (3m)-1.46%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.03%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.46%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.97 | ||
| Fwd PE | 25.1 | ||
| P/S | 6.18 | ||
| P/FCF | 40.12 | ||
| P/OCF | 33.47 | ||
| P/B | 6.86 | ||
| P/tB | N/A | ||
| EV/EBITDA | 25.24 |
EPS(TTM)12.53
EY3.34%
EPS(NY)14.96
Fwd EY3.98%
FCF(TTM)9.36
FCFY2.49%
OCF(TTM)11.22
OCFY2.99%
SpS60.75
BVpS54.77
TBVpS-11.23
PEG (NY)2.84
PEG (5Y)3.7
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.21% | ||
| ROE | 13.66% | ||
| ROCE | 13.63% | ||
| ROIC | 11.71% | ||
| ROICexc | 12.51% | ||
| ROICexgc | 42.69% | ||
| OM | 22.35% | ||
| PM (TTM) | 12.31% | ||
| GM | 64.57% | ||
| FCFM | 15.41% |
ROA(3y)7.1%
ROA(5y)6.34%
ROE(3y)15.24%
ROE(5y)14.27%
ROIC(3y)11.52%
ROIC(5y)10.64%
ROICexc(3y)12.76%
ROICexc(5y)11.81%
ROICexgc(3y)39.42%
ROICexgc(5y)36.5%
ROCE(3y)13.4%
ROCE(5y)12.38%
ROICexcg growth 3Y8.12%
ROICexcg growth 5Y2.5%
ROICexc growth 3Y8.12%
ROICexc growth 5Y0.63%
OM growth 3Y2.95%
OM growth 5Y-0.35%
PM growth 3Y4.36%
PM growth 5Y-1.09%
GM growth 3Y-0.02%
GM growth 5Y-0.49%
F-Score4
Asset Turnover0.5
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.69 | ||
| Debt/FCF | 4.69 | ||
| Debt/EBITDA | 2.3 | ||
| Cap/Depr | 66.95% | ||
| Cap/Sales | 3.06% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 68.59% | ||
| Profit Quality | 125.11% | ||
| Current Ratio | 1.64 | ||
| Quick Ratio | 1 | ||
| Altman-Z | 5.02 |
F-Score4
WACC8.47%
ROIC/WACC1.38
Cap/Depr(3y)62.25%
Cap/Depr(5y)59.95%
Cap/Sales(3y)3.11%
Cap/Sales(5y)3.16%
Profit Quality(3y)100.64%
Profit Quality(5y)122.75%
High Growth Momentum
Growth
EPS 1Y (TTM)14.32%
EPS 3Y10.28%
EPS 5Y8.09%
EPS Q2Q%13.6%
EPS Next Y10.57%
EPS Next 2Y10.78%
EPS Next 3Y11.11%
EPS Next 5Y9.96%
Revenue 1Y (TTM)10.76%
Revenue growth 3Y9.72%
Revenue growth 5Y8.71%
Sales Q2Q%11.88%
Revenue Next Year9.63%
Revenue Next 2Y8.99%
Revenue Next 3Y8.77%
Revenue Next 5Y8.2%
EBIT growth 1Y14.65%
EBIT growth 3Y12.96%
EBIT growth 5Y8.33%
EBIT Next Year25.23%
EBIT Next 3Y14.78%
EBIT Next 5Y13.73%
FCF growth 1Y57.79%
FCF growth 3Y8.39%
FCF growth 5Y17.73%
OCF growth 1Y49.62%
OCF growth 3Y9.14%
OCF growth 5Y14.13%