ConvaTec (CTEC) AI Stock Analysis

• Market Cap: £5.00B
• Dividend Yield: 2.11%
• Average Volume (3M): 6.27M
• Price to Earnings (P/E): 39.1
• Beta (1Y): 0.85
• Revenue Growth: 4.18%
• EPS Growth: 37.65%
• Country: UK
• Employees: 10,489
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Instruments & Supplies
• EPS (TTM): 0.07
• Shares Outstanding: 1,954,852,000
• 10 Day Avg. Volume: 5,278,857
• 30 Day Avg. Volume: 6,266,139
• PEG Ratio: -7.34
• Price to Book (P/B): 4.36
• Price to Sales (P/S): 2.66
• P/FCF Ratio: 19.37
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: £309.57
• Price Target Upside: 34.13% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 7
• EPS Forecast (FY): 0.2
• Revenue Forecast (FY): £2.56B

• Rating: 67 Neutral
• Price Target: 273.00p ▲(18.28% Upside)
• Action: Reiterated Date: 02/26/26
• Date: Action: Reiterated 02/26/26

The score is driven primarily by solid underlying financial performance (growth, improving operating margins, positive free cash flow) and supportive guidance for continued growth and margin expansion. This is tempered by increased leverage and notable operational/regulatory risks flagged on the call, while valuation looks expensive and technicals appear near overbought despite an uptrend.

Positive Factors

Recurring consumables revenue

ConvaTec's core model sells repeat-use consumables across chronic-care categories, creating predictable recurring revenue tied to ongoing patient needs and reimbursement. That stickiness supports durable top-line visibility, recurring cash flow and easier scaling of margin-accretive initiatives over months to years.

Consistent organic growth and margin expansion

The company has delivered multi-year organic growth and sustained operating margin expansion (cumulative ~460bps since 2021). Persistent demand and disciplined cost management imply structural improvement in operating leverage that supports durable earnings growth and the ability to invest in pipeline and capacity over the medium term.

Strong cash generation and capital allocation

Robust free cash flow and high conversion enable repeat buybacks, growing dividends and funding of growth CapEx without diluting shareholders. Consistent FCF provides financial flexibility to support capacity expansion and product launches, underpinning sustainable investment in high-return initiatives over the next few years.

Negative Factors

Rising leverage and net debt

Leverage has stepped up materially, reducing balance sheet flexibility and increasing sensitivity to interest rates or earnings volatility. Higher net debt limits room for opportunistic M&A or cushioning against shocks, and maintaining targets (circa 2x net debt/EBITDA) requires consistent cash generation and disciplined allocation.

FDA warning letter on complaints/CAPA

A regulatory warning on quality systems forces prioritized remediation, diverting management focus and requiring process, documentation and potentially capital fixes. If unresolved, it risks inspections, delays for new product rollouts, and could constrain reimbursement or hospital adoption—structural execution risk until closed.

InnovaMatrix reimbursement hit and impairment

A severe CMS price reduction and related impairment reveal material reimbursement and channel risk for acquired product lines. This directly lowers revenue and profitability for that portfolio, complicates integration economics for M&A, and underscores exposure to policy-driven payor changes that can persist and depress returns on similar assets.

ConvaTec Business Overview & Revenue Model

Company Description

ConvaTec Group Plc develops, manufactures, and markets medical products and technologies worldwide. It offers advanced wound dressings and skin care products for the management of acute and chronic wounds resulting from various conditions, such as diabetes, immobility, and venous disease, as well as from traumatic injury, burns, invasive surgery, and other causes. The company also provides devices, accessories, and services for people with a stoma resulting from colorectal cancer, inflammatory bowel disease, bladder cancer, obesity, and other causes. In addition, it offers continence and critical care products, including intermittent urinary catheters; and products for people with urinary continence issues related to spinal cord injuries, multiple sclerosis, spina bifida, and other urological disorders, as well as devices and products used in intensive care units and hospital settings. Further, the company provides advanced systems for managing acute fecal incontinence, as well as for monitoring urine production output and intra-abdominal pressure; and various disposable medical devices, such as wound drainage systems, urine collection bags and catheters, airway management and oxygen/aerosol therapy devices, suction handles and tubes, gastroenterology tubes, and securement devices. Additionally, it offers disposable infusion sets to manufacturers of insulin pumps for diabetes, as well as similar pumps that are used in continuous infusion treatments for other conditions; and various products to hospital and home healthcare markets. The company sells its products to pharmacies, hospitals, and other acute and post-acute healthcare service providers directly or through distributors and wholesalers. It serves a range of customers, including healthcare providers, patients, and manufacturers. The company was founded in 1978 and is headquartered in Reading, the United Kingdom.

How the Company Makes Money

ConvaTec generates revenue through the sale of its medical products across various sectors, including wound care, ostomy care, continence care, and infusion therapy. The company operates a direct sales model as well as partnerships with distributors and healthcare institutions, which allows it to reach a wide range of customers, including hospitals, clinics, and home care providers. Key revenue streams include the sale of proprietary medical devices and consumables, as well as ongoing service contracts for product usage and support. Significant partnerships with healthcare professionals and organizations enhance its distribution channels and market presence, contributing to stable and growing sales. Additionally, ConvaTec invests in research and development to innovate and expand its product offerings, which attracts new customers and drives revenue growth.

ConvaTec Financial Statement Overview

Summary

Steady revenue growth and improved operating profitability with consistently positive free cash flow support the profile. Offsetting factors are the step-up in leverage and only modest net margin, alongside less-than-ideal cash conversion versus reported earnings.

Income Statement

Revenue has grown steadily from 2022–2025 (2025 up ~5.7%), showing resilient demand. Profitability has improved meaningfully at the operating level (EBIT margin ~16.7% in 2025 vs ~11.8% in 2022), and EBITDA margin expanded to ~25.9%, indicating better cost control. The main weakness is that net margin remains modest (~7.2% in 2025) and net income dipped versus 2024 despite higher revenue, suggesting below-the-line costs or taxes are limiting bottom-line conversion.

Balance Sheet

The balance sheet shows moderate profitability on equity (return on equity ~11.8% in 2025, improved from ~3.9% in 2022), which supports overall quality. However, leverage has increased: debt-to-equity rose to ~1.06 in 2025 from ~0.71 in 2024, meaning the company is now more debt-funded than equity-funded. This higher leverage reduces flexibility and increases sensitivity to earnings or rate pressure, even though assets have grown alongside the business.

Cash Flow

Cash generation is solid with operating cash flow at ~£480m and free cash flow at ~£342m in 2025, comfortably positive across years. Still, free cash flow slipped slightly in 2025 (about -2.2% growth), and free cash flow is running below net income (about 0.71x in 2025), pointing to less-than-ideal earnings-to-cash conversion. Operating cash flow also covers less than the full level of reported profit (about 0.78x in 2025), which is acceptable but not a clear strength.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	2.49B	2.29B	2.14B	2.07B	2.04B
Gross Profit	1.37B	1.28B	1.20B	1.12B	1.12B
EBITDA	644.24M	540.20M	455.50M	419.10M	405.40M
Net Income	178.67M	190.50M	130.30M	62.90M	117.60M
Balance Sheet
Total Assets	3.78B	3.52B	3.71B	3.59B	3.67B
Cash, Cash Equivalents and Short-Term Investments	75.03M	64.70M	98.30M	145.80M	463.40M
Total Debt	1.61B	1.20B	1.31B	1.30B	1.44B
Total Liabilities	2.26B	1.83B	2.02B	1.98B	1.98B
Stockholders Equity	1.52B	1.69B	1.69B	1.61B	1.69B
Cash Flow
Free Cash Flow	342.03M	274.10M	238.20M	137.50M	211.80M
Operating Cash Flow	479.86M	396.20M	367.40M	281.70M	305.90M
Investing Cash Flow	-212.36M	-160.80M	-285.70M	-348.30M	-206.50M
Financing Cash Flow	-263.41M	-263.80M	-124.00M	-237.10M	-199.90M

ConvaTec Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 230.80
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:CTEC, the sentiment is Positive. The current price of 230.8 is below the 20-day moving average (MA) of 232.20, below the 50-day MA of 235.72, and below the 200-day MA of 244.59, indicating a bullish trend. The MACD of 4.77 indicates Negative momentum. The RSI at 72.78 is Negative, neither overbought nor oversold. The STOCH value of 88.02 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:CTEC.

ConvaTec Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TSTL	77 Outperform	£191.73M	28.74	20.31%	3.48%	10.80%	1.75%
SN	70 Outperform	£11.64B	31.58	9.30%	2.35%	2.51%	56.56%
AMS	69 Neutral	£464.15M	50.47	3.66%	1.25%	68.03%	-18.27%
CTEC	67 Neutral	£5.00B	39.09	12.73%	2.11%	4.18%	37.65%
CVSG	66 Neutral	£931.68M	59.87	6.75%	0.67%	4.00%	-6.98%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

ConvaTec Corporate Events

ConvaTec Lifts Growth Targets After Strong 2025 Earnings and Margin Gains

ConvaTec posted 2025 revenue of $2.44 billion, up 6.5% on a reported basis, with organic growth excluding InnovaMatrix of 6.4% and broad-based gains across advanced wound care, ostomy care, continence care and infusion care. Adjusted operating profit rose 12.1% to $544 million, lifting the adjusted margin by 110 basis points to 22.3%, while adjusted diluted EPS climbed 16% as strong cash generation funded $185 million of capex, $140 million in dividends and a $300 million share buyback.

Category performance was led by 12.5% organic growth in infusion care and solid mid-single to high-single digit growth in the other businesses, offset by a sharp decline in InnovaMatrix revenue and a $72 million impairment tied to CMS reimbursement changes. Management guided to another year of double-digit adjusted EPS growth in 2026, reaffirmed 5–7% underlying organic revenue growth excluding InnovaMatrix and at least a 23% adjusted operating margin, and upgraded its medium-term organic growth target to 6–8% from 2027 with a mid-20s margin and sustained double‑digit EPS and free cash flow growth, underscoring confidence in its innovation pipeline and strategic execution.

The group strengthened its balance sheet and funding profile by achieving investment-grade status with all three major credit agencies and issuing a new $500 million 10-year senior unsecured note, while keeping net leverage at 2.0x adjusted EBITDA, in line with its target. The board raised the full-year dividend by 13% and maintained a payout ratio of 40% of adjusted net profit, signalling confidence in future cash flows and creating a supportive backdrop for shareholders amid continued investment in new products and capacity to meet rising demand.

The most recent analyst rating on (GB:CTEC) stock is a Buy with a £3.25 price target. To see the full list of analyst forecasts on ConvaTec stock, see the GB:CTEC Stock Forecast page.

Convatec Confirms Year-End Share Capital and Voting Rights

Convatec Group has disclosed its total voting rights as of 31 December 2025, reporting an issued share capital of 2,049,789,559 ordinary shares of 10 pence each, of which 94,937,530 are held in treasury without dividend or voting rights. This leaves 1,954,852,029 voting shares in circulation, a key reference figure for investors monitoring their holdings and regulatory disclosure thresholds under UK financial transparency rules, and it provides the market with clarity on the company’s capital structure at year-end.

The most recent analyst rating on (GB:CTEC) stock is a Buy with a £375.00 price target. To see the full list of analyst forecasts on ConvaTec stock, see the GB:CTEC Stock Forecast page.

ConvaTec Concludes $300 Million Share Buyback Program

ConvaTec Group PLC has completed its share buyback program, purchasing 1,912,745 ordinary shares through UBS AG London Branch, as part of a $300 million initiative announced earlier in August 2025. The shares, bought at an average price of 230.19 pence, will be held in treasury, and this transaction concludes the buyback program, potentially impacting the company’s share value and market positioning.

The most recent analyst rating on (GB:CTEC) stock is a Buy with a £3.25 price target. To see the full list of analyst forecasts on ConvaTec stock, see the GB:CTEC Stock Forecast page.

ConvaTec Executes Share Buyback as Part of $300 Million Program

ConvaTec Group PLC has executed a share buyback transaction, purchasing 3,975,464 ordinary shares as part of its ongoing $300 million share buyback program announced in August 2025. This strategic move, facilitated through UBS AG London Branch, is intended to optimize the company’s capital structure and potentially enhance shareholder value by reducing the number of shares in circulation, which may impact the company’s stock price and voting rights.

The most recent analyst rating on (GB:CTEC) stock is a Buy with a £3.25 price target. To see the full list of analyst forecasts on ConvaTec stock, see the GB:CTEC Stock Forecast page.

ConvaTec Executes Share Buyback as Part of $300M Program

ConvaTec Group PLC has executed a share buyback transaction, purchasing 284,667 ordinary shares as part of its $300 million share buyback program announced earlier in August 2025. The purchased shares will be held in treasury, and this move is expected to impact the company’s share capital structure, potentially enhancing shareholder value by reducing the number of shares in circulation.

The most recent analyst rating on (GB:CTEC) stock is a Buy with a £3.25 price target. To see the full list of analyst forecasts on ConvaTec stock, see the GB:CTEC Stock Forecast page.

Convatec Announces Updated Total Voting Rights

Convatec Group Plc announced its total voting rights as of November 30, 2025, with an issued share capital comprising over 2 billion ordinary shares, of which approximately 1.96 billion carry voting rights. The company also noted that shares purchased under a buyback program are in the settlement process and will be held in treasury. This update is relevant for shareholders to determine their notification obligations under the FCA’s rules.

The most recent analyst rating on (GB:CTEC) stock is a Buy with a £3.25 price target. To see the full list of analyst forecasts on ConvaTec stock, see the GB:CTEC Stock Forecast page.

ConvaTec Executes Share Buyback as Part of $300 Million Program

ConvaTec Group PLC announced the purchase of 806,991 of its ordinary shares as part of a share buyback program valued up to $300 million. This move, executed through UBS AG London Branch, reflects the company’s strategy to manage its capital structure and potentially enhance shareholder value, with the purchased shares being held in treasury.

The most recent analyst rating on (GB:CTEC) stock is a Buy with a £3.25 price target. To see the full list of analyst forecasts on ConvaTec stock, see the GB:CTEC Stock Forecast page.

ConvaTec Advances $300M Share Buyback with Recent Purchase

ConvaTec Group PLC has announced the purchase of 259,860 ordinary shares as part of its $300 million share buyback program initiated in August 2025. The shares were acquired at a volume-weighted average price of 234.29 pence and will be held in treasury. This move is part of ConvaTec’s strategy to optimize its capital structure and return value to shareholders, potentially enhancing its market position and investor confidence.

The most recent analyst rating on (GB:CTEC) stock is a Buy with a £3.25 price target. To see the full list of analyst forecasts on ConvaTec stock, see the GB:CTEC Stock Forecast page.

ConvaTec Advances $300M Share Buyback Program

ConvaTec Group PLC has executed a share buyback transaction, purchasing 30,024 ordinary shares as part of its $300 million share buyback program announced earlier in August 2025. The shares, acquired through UBS AG London Branch, will be held in treasury, and this move is part of the company’s strategy to manage its capital structure and return value to shareholders. This transaction reflects ConvaTec’s ongoing commitment to optimizing shareholder value and may influence its market position by reducing the number of shares in circulation, potentially impacting share value and investor interest.

The most recent analyst rating on (GB:CTEC) stock is a Buy with a £3.25 price target. To see the full list of analyst forecasts on ConvaTec stock, see the GB:CTEC Stock Forecast page.

ConvaTec Executes Share Buyback as Part of $300 Million Program

ConvaTec Group PLC has executed a share buyback transaction as part of its previously announced $300 million program. The company purchased 237,996 ordinary shares at a volume-weighted average price of 235.49 pence per share, which will be held in treasury. This move is part of ConvaTec’s strategy to manage its capital structure and return value to shareholders, potentially impacting its market positioning and shareholder interests.

The most recent analyst rating on (GB:CTEC) stock is a Buy with a £3.25 price target. To see the full list of analyst forecasts on ConvaTec stock, see the GB:CTEC Stock Forecast page.