Caitlin Cronin, an analyst from Canaccord Genuity, maintained the Hold rating on Smith & Nephew Snats (SNN – Research Report). The associated price target is $27.00.
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Caitlin Cronin’s rating is based on a combination of factors affecting Smith & Nephew Snats. The company showed promising results in the US market, particularly in the Reconstruction segment, with significant growth in CORI placements. However, challenges persist, especially in China, where the company faces headwinds due to Value-Based Procurement (VBP) impacts on Sports Medicine and a reduction in distributor inventory purchasing. These factors have led to a conservative growth outlook for the first quarter, with expectations of stronger growth in subsequent quarters.
Despite the positive trends in the US Orthopedics segment, the return on invested capital (ROIC) for this segment remains significantly lower than that of other business units. The company anticipates further VBP impacts in the Advanced Wound Management (AWM) segment, which could negatively affect revenues in the latter half of 2025. While Smith & Nephew is making strides in innovation, particularly with its CORI platform, the persistent macroeconomic and operational challenges, especially in China, warrant a cautious approach, leading to the Hold rating.