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Yahoo
16-05-2025
- Business
- Yahoo
Q4 2025 STERIS plc Earnings Call
Julie Winter; IR Contact Officer; STERIS plc Michael Tokich; Chief Financial Officer, Senior Vice President; STERIS plc Daniel Carestio; President, Chief Executive Officer, Director; STERIS plc Dave Turkaly; Analyst; Citizens JMP Securities, LLC Mike Matson; Analyst; Needham & Company Patrick Wood; Analyst; Morgan Stanley Mac Etoch; Analyst; Stephens Inc. Michael Polark; Analyst; Wolfe Research Jason Bednar; Analyst; Piper Sandler Companies Brett Fishbin; Analyst; KeyBanc Capital Markets Operator Good morning everyone and welcome to the STERIS plc fourth quarter 2025 conference call. (Operator Instructions) Please note that today's event is being recorded. At this time I'd like to turn the floor over to Julie Winter, Investor Relations. Ma'am, please go ahead. Julie Winter Thank you, Jamie and good morning everyone. As usual, speaking on today's call will be Mike Tokich, our Senior Vice President and CFO; and Dan Carestio, our President and CEO, and I do have a few words of caution before we open for comment. This webcast contains time-sensitive information that is accurate only as of today. Any redistribution, retransmission or rebroadcast of this call without the expressed written consent of STERIS is strictly prohibited. Some of the statements made during this review are or may be considered forward-looking statements. Many important factors could cause actual results to differ materially from those in the forward-looking statements, including without limitation, those risk factors described in STERIS' securities filings. The company does not undertake to update or revise any forward-looking statements as a result of new information or future events or developments. STERIS' SEC filings are available to the company and on our website. In addition, on today's call, non-GAAP financial measures, including adjusted earnings per diluted share, adjusted operating income, constant currency organic revenue growth and free cash flow will be used. Additional information regarding these measures, including definition is available in our release as well as reconciliations between GAAP and non-GAAP financial measures. Non-GAAP financial measures are presented during this call with the intent of providing greater transparency to supplemental financial information used by management and the Board of Directors in their financial analysis and operational decision-making. With those cautions, I will hand the call over to Mike. Michael Tokich Thank you, Julie, and good morning, everyone. It is once again my pleasure to be with you this morning to review the highlights of our fourth quarter performance from continuing operations. For the fourth quarter, total as reported revenue grew 4%. Constant currency organic revenue grew 6% in the quarter, driven by volume as well as 210 basis points of price. Gross margin for the quarter increased 170 basis points compared with the prior year to 44.3%. Positive price, favorable mix and productivity outpaced labor inflation. EBIT margin increased 110 basis points to 24.8% of revenue compared with last year. The adjusted effective tax rate in the quarter was 23.5%, and the year over year increase was driven by unfavorable discrete item adjustments. Net income from continuing operations in the quarter was $270 million, adjusted earnings per diluted share from continuing operations was $2.74, a 14% increase over the prior year. We are pleased with our ability to grow earnings double digits all year with lower interest expense following the divestiture of the dental segment. Capital expenditures for fiscal 2025 totaled $370 million, while depreciation and amortization totaled $476 million. We continue to pay down debt during the quarter, ending with $2 billion in total debt. Gross debt to EBITDA at quarter end was approximately 1.4 times. Free cash flow for fiscal 2025 was a record $787 million, well above our full year guidance, driven by significant working capital improvements, in particular, inventory. With that, I'll turn the call over to Dan for his remarks. Daniel Carestio Thanks, Mike, and good morning, everyone. Thank you for joining us to hear more about our fiscal 2025 performance and our outlook for fiscal 2026. Mike covered the quarter, so I will touch on our performance for the full year and our outlook for fiscal 2026. From a total company perspective, we ended the year with 6% revenue growth and 12% earnings growth. The diversified nature of our business allowed us to deliver results in line with our original outlook despite a few obstacles during the year. Looking at our segments, healthcare constant currency organic revenue grew 6% for the year led by strong recurring revenue streams. Our outperformance in consumables and services continues to be driven by procedure volumes in the US as well as price and market share gains. Healthcare capital equipment revenue declined 5% for the year against our record year last year. Capital equipment orders grew over 12% for the full year as underlying demand remained strong. Margins improved nicely in healthcare, hitting the 25% mark for the year, with volume, pricing and positive productivity offsetting labor inflation. Towards the end of the year, we also began to benefit from the restructuring cost savings, capturing approximately $5 million in savings in the fourth quarter of fiscal 2025. Turning to AST. Constant currency organic revenue grew 9% for the year with 7% growth in services. Med device customers remained stable, while bioprocessing was a bit lumpy during the year. Capital equipment shipments more than doubled compared to the prior year and exceeded our expectations. EBIT margins for AST were 44.8%, down slightly year over year as we continue to face energy and labor headwinds and had a negative mix shift from capital equipment shipments. Constant currency organic revenue increased 1% for life sciences for the full year, driven once again by strong growth in consumables and services offset by a decline in capital equipment revenue. Margins increased to 42.3%, a 360 basis point improvement, benefiting from favorable mix, pricing and the divestiture of the CECS business. From an earnings perspective, we ended the year strong and exceeded our revised outlook with adjusted EPS of $9.22. The upside to our estimates was driven by lower corporate spending and improved profitability in both healthcare and the life science segments. Turning to our outlook for fiscal 2026. As noted in the press release, we anticipate as reported revenue from continuing operations to grow 6% to 7% in fiscal 2026. We do not have any acquisition or divestiture impacts heading into the new fiscal year, and changes in foreign currency are expected to be neutral to STERIS. As a result, constant currency organic revenue growth is also expected to grow 6% to 7%. Included in this outlook is approximately 200 basis points of price. Each segment is expected to grow revenue in the range of 6% to 7% for fiscal 2026. One minor note on AST revenue growth, our outlook reflects high single-digit growth in services revenue, which will be somewhat offset by a decline in capital equipment to get to the 6% to 7% growth total for the year. As you saw in the press release, we have estimated the impact for tariffs for fiscal 2026, which are reflected in our outlook. We manufacture a significant number of products in North America for use in the US with about 85% of the products sold in the US coming from North American manufacturing. This significantly reduces our tariff exposure compared to many others, but we are not immune to the impact of tariffs. Our fiscal 2026 outlook of $9.90 to $10.15 includes $30 million of tariff costs. The EPS range implies 7% to 10% growth in earnings, including tariffs, which is impressive performance. I want to take a moment to thank our supply chain and commercial teams for all their efforts on this front. The anticipated tariff impact is a net number. We do expect to leverage the strength of STERIS to mitigate some of our exposure. The $30 million estimate is based on global tariffs currently in effect, including the 10% global tariff and the recently announced 90-day trade deal with China. For your modeling purposes, at the high end of our earnings range, we would expect EBIT margins to increase approximately 20 basis points reflecting our ability to offset tariffs. The effective tax rate is planned at approximately 23.5%. As we enter into the new fiscal year, we are well positioned to deliver both top and bottom line growth in 2026. That concludes our prepared remarks for the call. Julie, would you please give the instructions so that we can begin the Q&A. Julie Winter Thank you, Mike and Dan, for your comments. Jamie, can you please give the instructions for Q&A and we'll get started. Operator (Operator Instructions) Dave Turkaly, Citizens. Dave Turkaly Hey, good morning, and congrats on the quarter and the year. I guess, when we look at the segments, the biggest implied delta and then that life side. And I was just curious to get some color on your comfort in that kind of bouncing back to that 6% to 7% range. Daniel Carestio Yeah. We did extremely well this year in our recurring revenues, especially our chemistries and consumables business. And we would expect that to continue. Where we were down significantly, was obviously capital equipment with a lot of uncertainty in pharma, the orders just dried up in the first half of the year. However, we saw a really strong rebound late in the year, and we are coming into fiscal 2026 with a pretty good backlog at a pretty good rate of orders. So we're confident that we'll be able to deliver the bulk of those in the fiscal 2026 and continue on with the growth that we've seen historically within our consumables business. Dave Turkaly Great. One quick follow-up. It seems like the tariff impact might be, I don't know, $0.24 or something like that on the EPS line, yet you're still getting into double-digit range at the high end. I guess if you could just talk about some of the puts and takes, maybe even on the interest expense. I know you delevered a bunch, but to get to that even despite the tariffs, just maybe some color there. Michael Tokich Yeah, Dave, this is Mike. So as normal, there's quite a bit of headwinds or tailwinds or puts and takes. First and foremost, we are going to benefit from about $20 million of restructuring cost savings that will be in FY '26. So that's a good guide. In addition to that, we do not anticipate spending $20 million-plus in EtO litigation. We anticipate spending about $5 million. So there's $15 million to the good also. But offsetting that is incentive comp getting back to 100% bonus. That is a negative $15 million. Obviously, the tariffs are another negative $15 million. And then if you look at our lower interest expense is really going to offset our higher tax rate. So that's just a reconciliation for FY26 or the puts and takes. Dave Turkaly Thank you. Michael Tokich You're welcome. Operator Mike Matson, Needham & Company. Mike Matson Yeah. Thanks. So just your cash flow guidance is a little bit down from 25%. I know you called out the working capital improvement you saw in '25. I mean is that the mean kind of differential between the two years? Michael Tokich The big thing, Mike, is we anticipate paying $40 million legal settlement for EtO, which is in FY '26. So that's going to negatively impact cash by $40 million. And of course, we are not anticipating to overachieve or reduce inventory as dramatically as we had in FY25. But the big difference is the EtO legal fees, plus the impact of tariffs will negatively impact free cash flow also. Mike Matson Okay. Got it. And then just your leverage ratio is down quite a bit. So just maybe you can give us an update on M&A, I'd expected you'd probably be looking to do some more deals if you can find things, but -- Daniel Carestio Yeah. I mean this is Dan. What I would say, Mike, is that we have the capacity both from a financial perspective and from an intellectual perspective at this point, having not done any meaningful M&A now for a few years. So if the right opportunity presents itself, we'll be involved. Mike Matson Okay. Thank you. Operator Patrick Wood, Morgan Stanley. Patrick Wood Awesome. Thanks, [Sigma]. Just two quick ones. It's probably too early to say, but how the conversations with the customer has been around potentially like onshoring back to the US? I'm trying to think of -- I know some of the outsourced contract manufacturers have seen like a big pickup in people trying to pull production back. I'm just curious, is that something that you think is actually going to happen or is it more just a nice bullet point on a McKinsey slide. Daniel Carestio It's probably the latter. But I do think there is some opportunities. I assume you're talking about med tech in particular, but I do think there are some opportunities. Many of those large companies have manufacturing for local regions. And to the extent that they may be manufacturing in Europe for the US and they have US based manufacturing for similar products, you may see some shift of volumes going east or west depending on the benefit that they can do in terms of tariff. And how easy it is to do it? Keep in mind, highly regulated industry, it's not easy to move production volumes if they don't have all the regulatory permits and things like that. So it takes time. But there'll be some fluidity to it, I'm sure. Patrick Wood That's awesome. And then just like quickly around the kind of a M&A angle again. What have you been hearing from some of the smaller players, niche compliance costs, all those sorts of things. Is there a situation where I know capacity is tight. And is there a situation where they end up having to force sell themselves essentially to you guys or your peers? Like how do you think about industry consolidation on the back of the kind of one-off costs there? Daniel Carestio I mean, in a general sense, I do think there'll be some industry consolidation, but we'd be in a much better position, greenfielding than we would be buying assets that are 30 year old-plus. Patrick Wood I mean I'm 40, so I take offense of that. But thanks guys. Daniel Carestio Well, you've been compliant your whole life. Patrick Wood That's definitely not true. Operator Mac Etoch, Stevens Inc. Mac Etoch Hey, good morning. I'll add my congrats on the quarter and the year as well. Maybe just touching on the outlook for FY26. As you commented on AST kind of coming in line with the 6% to 7% growth for the year. low single digits for capital equipment, high single digits for services. But can you flesh out what you're seeing within the respective customer bases there? I think there's a little bit of a delta between what maybe I and the street were expecting versus your internal expectations. So if you could just provide us a little color there, that would be great. Daniel Carestio Yeah. I think what we're doing here is we've seen a lot of just movement month to month, quarter to quarter in terms of volume, it has started to sort of modulate down. But our view is let's take a little more conservative approach on how aggressively some of the bioprocessing is going to recover and also as customers reassess where they're manufacturing and if there is any movement going on and what implications that may have on total volume. Mac Etoch Got it. And then just in light of like the current macro and everything that's going on with general policy, is there how are conversations progressing with clients? Has there been any change in behaviors relating to life sciences or the AST segment? Daniel Carestio Nothing that I would point to, a number of discussions, but I can't say there's anything concrete. Mac Etoch Thank you for taking my questions. Appreciate it. Daniel Carestio Sure. Thanks. Operator Michael Polark, Wolfe Research. Michael Polark Hey, good morning. Maybe two on healthcare. The first one, the allusion to market share gains driving growth in the fiscal year and quarter. I know we've talked about this before, but is there any service or business line that really stands out to you there as to STERIS doing way better than market? If so, what is it? And what's going right? Daniel Carestio Honestly, I would say it's just across the entire segment right now. Our teams are just doing a phenomenal job in particular, in the North American markets that we're just -- we've just built out such a great portfolio an enterprise solution for large systems around sterile processing in particular and all the services that go along with that, that we continue to do really well. Michael Polark And for the fiscal year ahead, 6% to 7% growth for the healthcare segment, would you call out any expected variances between how consumables, services and equipment should grow in '26? Daniel Carestio No, we're not going to provide that level of granularity. I will hit back on the fact that we had a great order year for -- that bodes well in terms of backlog for capital going into next year. And so we're optimistic about that. Michael Polark Thank you. Operator Jason Bednar, Piper Sandler. Jason Bednar Hey morning everyone. Nice finish to the year here. I wanted to see if we could spend just maybe a bit more time on tariffs, really topical for all companies here this quarter, maybe break down, if you could, what the -- what that $30 million looks like across your network? I think -- I know you had $30 million in the press release, Mike, I think you made to some comment at one point, I think, pre-year on around $15 million, but I just want to confirm it's $30 million net. And then if possible, break down, maybe again how much exposure you have here around like China-related tariffs and how much on the non-China side? I would just be helpful so we can update our own thinking as we see the next updates on the tariff front? Daniel Carestio I mean -- this is Dan. I'll let Mike add to this. But at a high level, it's about half China and half sort of the 10% global tariff, and it's about $30 million. Michael Tokich No more to add on that. Jason Bednar All right. I like it. I think you said that $30 million, again, is a net number. Are you assuming any mitigation actions in that $30 million figure? Kind of what does the pacing of that activity look like throughout fiscal '26? And then I'll just sneak in one extra here. It looks like share repo was a little lighter in the fourth quarter compared to the prior few quarters, but the stock has been hanging around a similar level now for some time, well off its size. Maybe just talk about the decision to pause some of that activity? And is there a signal we should draw from that cause? Michael Tokich Yeah. I would say that, in general, we had bought about $200 million of shares during FY25. We had bought those earlier in the year compared to the previous year. And I would say there's no signal that we're driving there. It is almost double what we typically bought just to offset dilution. And obviously, with our debt levels and debt ratios being where they are, we would definitely consider doing additional share buybacks beyond our offsetting -- just offsetting dilution in the future. Jason Bednar Okay. Sorry, on the mitigation activity on tariffs? Michael Tokich Yeah. The $30 million is a net number, Jason. So it's significantly higher than that. Obviously, there's a lot to be done to mitigate. Timing is always the question. Obviously, our supply chain guys and girls are working very hard to offset as much as possible. But yeah, it's a net number of $30 million, and we anticipate that, that will hit us about equally throughout the calendar year. Daniel Carestio Yeah. I would just add to that. With the 90-day pause or sort of redirect on the China tariffs, it gives us an opportunity to be much more strategic and thoughtful in terms of anything that we're changing as it relates to either vendors or manufacturing location or supply. So I would expect more weight on the back end. Julie Winter And also, I don't think we've said there's more weight on healthcare, primarily will be impacting the healthcare segment with a little bit in life sciences. Michael Tokich And very, very little, if any, in AST. Jason Bednar All right. Very good. Thank you everyone. Daniel Carestio You're welcome. Operator (Operator Instructions) Brett Fishbin, KeyBanc. Brett Fishbin Hey guys, thank you very much for taking the questions and good morning. Just wanted to ask another question on healthcare capital equipment. It sounds like you're not trying to give specific guidance on growth, but maybe just talk a little bit more about the capital equipment backdrop. You're exiting the year with some growth in the backlog, but really just curious how like some of the recent macro developments have impacted like either ordering patterns or like hospitals' willingness to do implementations versus like any deferrals you may be seeing? Daniel Carestio We've talked about this a lot in the past, and that is the capital equipment that we offer is really more of a utility than a luxury item. If you're going to see procedural growth and migration of procedures in different places, you can't accommodate that growth without having sterile processing capacity or surgical suites. So at times when it may impact replacement business, if those things can be deferred, it doesn't really impact the new equipment in terms of going into expansions. So we had a great order year last year, growing orders 12%. We've got our backlog into a very comfortable position. We haven't seen anything at this point that would indicate that, that's slowing for us and in fact, had really good volume in terms of orders going into Q1. So we're excited about the opportunity there. Brett Fishbin And then just as a follow-up, I'm going to switch gears a little bit to AST. I think it was a pretty good sequential progression in FY25 from an AST growth standpoint. Just looking at FY26 for services, it sounds like high single digits is kind of the starting point. I'm just curious if like demand were to be higher than expected, do you have enough capacity to theoretically return to double-digit growth in AST service? Or is capacity starting to become like a little bit of a limiting factor? Thank you very much. Daniel Carestio Sure. It's not a governor for us right now. We are well positioned to accommodate the industry's growth. Operator Michael Polark, Wolfe Research. Michael Polark Hey, thank you. Just one more also on AST. As you reflect on fiscal '25 in the services line, the December quarter was up 10%, March quarter up 6%. Dan, it sounds like bioprocess is a little lumpy. Is that -- is that the gyration or anything else to kind of spike out on the phasing of the last 12 months that makes more sense to you? My one other idea is any evidence that there was kind of front-loading of inventory building ahead of the Trump tariff era in the December quarter? Could that have been an influence in that period? Any other color would be great. Thank you. Daniel Carestio Sure. Yeah. No, we did not see that in terms of anybody front-loading tariff, but I think you're giving the industry way too much credit to be able to see that coming. What I would say is we had a phenomenal December, an extraordinary December in terms of year over year comps. And then nobody showed up for the first seven days of January. So just the plant restarts from a customer perspective was very abnormally slow this year, one day shorter of February in terms of processing days, and then we had a wonderful second half of February and March in terms of growth. So -- but overall, those things impacted the quarter. I don't think it was anything more than that. Michael Polark Thank you. Operator And ladies and gentlemen, with that, we'll conclude today's question-and-answer session. I'd like to turn the floor back over to management for any closing remarks. Julie Winter Thank you, everybody, for taking the time to join us this morning, and we look forward to catching up with many of you in the coming weeks. Operator And with that, ladies and gentlemen, we'll conclude today's conference call and presentation. We do thank you for joining. You may now disconnect your lines.
Yahoo
26-04-2025
- Business
- Yahoo
STERIS plc (STE): One of the Overlooked Dividend Stocks to Buy Now
We recently published a list of the 10 Overlooked Dividend Stocks to Buy Now. In this article, we are going to take a look at where STERIS plc (NYSE:STE) stands against other overlooked dividend stocks. In recent times, dividend investing—also known as equity income—has fallen out of favor. Once a widely followed and dependable strategy, it has gradually been overshadowed. The strong capital gains delivered by growth stocks appear to have shifted investors' attention away from the more stable and consistent returns that come with dividend-paying stocks. However, the recent market downturn, combined with the economic impact of Trump's trade policies, has brought renewed attention and appeal to these types of stocks. The S&P Dividend Aristocrats Index, which tracks the performance of companies with at least 25 consecutive years of dividend growth, has fallen by a little over 2% since the start of 2025, compared with a 6% fall in the broader market. Dividend stocks have seen mixed results over different economic cycles—performing well in some downturns and falling behind in others. They generally outpaced the broader market during the recessions starting in July 1981, March 2001, and December 2007. However, their performance lagged during the shorter recessions in 1980 and 2020. This was mainly due to dividend cuts from major firms, along with limited exposure to fast-growing tech names. For context, the steepest drop in dividends came during the 2008–09 financial crisis, when S&P dividend payouts declined by 24%, though investors still received 76% of their income. That said, while the possibility of dividend reductions is a valid concern and a potential drawback of this strategy, it shouldn't be a reason to overlook dividend stocks altogether. When incorporated thoughtfully, they can still play a valuable role in a well-rounded investment portfolio. M&G Investments noted that dividends serve as more than just income—they also signal a company's financial health and management's confidence. While short-term market returns often hinge on stock valuations, dividends play a much more substantial role in driving equity returns over longer periods, such as 10 or 20 years. The report also mentioned, citing Bloomberg's data, that dividends play a vital role in long-term returns. Over the last 25 years, nearly half of the total gains from US stocks have come from reinvested dividends and the power of compounding. During this period, the broader market delivered an average annual return of 7.4%, with 55% attributed to rising stock prices and the remaining 45% coming from reinvested dividend income. The fact that dividends are not guaranteed highlights a deeper financial story behind corporate decisions. Companies must carefully weigh the trade-off between returning profits to shareholders and keeping enough earnings on hand to support future expansion. Getting this balance right is a strategic task. A particularly high dividend payout ratio—typically above 75%, though this varies by sector—can raise red flags about sustainability. When too much profit is paid out, there's little room left to increase dividends down the line. This could eventually lead a company to scale back or even stop its dividend payments altogether, which may hold back both business growth and long-term gains in share value. Given this, we will take a look at some overlooked stocks that pay dividends. A nurse in a hospital room, administering a procedural medical product in an infection prevention setting. For this list, we thoroughly reviewed reputable sources such as Forbes, Morningstar, Barron's, and Business Insider and searched for stocks that remain under the radar but have strong balance sheets and sound financials. In addition, these lesser-known dividend companies also boast dividend growth track records, which make them a reliable option for income investors. After compiling our data, we picked 10 companies with the highest number of hedge fund investors, as per Insider Monkey's Q4 2024 database. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (). Number of Hedge Fund Holders: 48 STERIS plc (NYSE:STE) is an Ireland-based medical equipment company that specializes in sterilization and surgical products for the US healthcare system. The company is gaining traction among investors as healthcare systems rely on Steris' products and services regardless of economic challenges, as they are essential for delivering care to patients. Since the start of 2025, the stock has surged by over 11%. In fiscal Q3 2025, STERIS plc (NYSE:STE) posted revenue of $1.3 billion, down 1.8% from the same period last year. The company reported net income of $173.6 million, or $1.75 per diluted share, up from $148.4 million, or $1.49 per diluted share, in the same period of fiscal 2024. Healthcare revenue rose by 7% in the quarter, reaching $976.0 million, up from $916.2 million in the third quarter of fiscal 2024. This increase was driven by a 9% rise in consumable sales and a 13% boost in service revenue, partially offset by a 5% drop in capital equipment revenue. For the first nine months of fiscal 2025, STERIS plc (NYSE:STE) reported a net cash from operations totaled $887.3 million, up from $718.5 million during the same period in fiscal 2024. Free cash flow also increased, reaching $588.1 million compared to $457.0 million in the previous year. It currently offers a quarterly dividend of $0.57 per share and has a dividend yield of 1.01%, as of April 25. Overall, STE ranks 1st on our list of the best overlooked dividend stocks to invest in. While we acknowledge the potential of STE as an investment, our conviction lies in the belief that some deeply undervalued dividend stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for a deeply undervalued dividend stock that is more promising than STE but that trades at 10 times its earnings and grows its earnings at double digit rates annually, check out our report about the . READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at . Sign in to access your portfolio
Yahoo
12-04-2025
- Business
- Yahoo
Why STERIS plc (NYSE:STE) Could Be Worth Watching
STERIS plc (NYSE:STE) received a lot of attention from a substantial price movement on the NYSE over the last few months, increasing to US$233 at one point, and dropping to the lows of US$202. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether STERIS' current trading price of US$221 reflective of the actual value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let's take a look at STERIS's outlook and value based on the most recent financial data to see if there are any catalysts for a price change. This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality. Great news for investors – STERIS is still trading at a fairly cheap price. According to our valuation, the intrinsic value for the stock is $336.24, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. Another thing to keep in mind is that STERIS's share price may be quite stable relative to the rest of the market, as indicated by its low beta. This means that if you believe the current share price should move towards its intrinsic value over time, a low beta could suggest it is not likely to reach that level anytime soon, and once it's there, it may be hard to fall back down into an attractive buying range again. View our latest analysis for STERIS Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Although value investors would argue that it's the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. STERIS' earnings over the next few years are expected to increase by 43%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value. Are you a shareholder? Since STE is currently undervalued, it may be a great time to increase your holdings in the stock. With an optimistic outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as financial health to consider, which could explain the current undervaluation. Are you a potential investor? If you've been keeping an eye on STE for a while, now might be the time to enter the stock. Its prosperous future outlook isn't fully reflected in the current share price yet, which means it's not too late to buy STE. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed buy. If you'd like to know more about STERIS as a business, it's important to be aware of any risks it's facing. While conducting our analysis, we found that STERIS has 1 warning sign and it would be unwise to ignore this. If you are no longer interested in STERIS, you can use our free platform to see our list of over 50 other stocks with a high growth potential. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
