Sotera Health (SHC) AI Stock Analysis

• Market Cap: $4.88B
• Dividend Yield: N/A
• Average Volume (3M): 3.05M
• Price to Earnings (P/E): 89.0
• Beta (1Y): 0.94
• Revenue Growth: 2.67%
• EPS Growth: -21.96%
• Country: US
• Employees: 3,000
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Diagnostics & Research
• EPS (TTM): 0.26
• Shares Outstanding: 284,093,930
• 10 Day Avg. Volume: 2,527,179
• 30 Day Avg. Volume: 3,047,695
• PEG Ratio: -7.84
• Price to Book (P/B): 9.55
• Price to Sales (P/S): 3.52
• P/FCF Ratio: 85.79
• Enterprise Value/Market Cap: 1.33
• Enterprise Value/Revenue: 5.64
• Enterprise Value/Gross Profit: 10.07
• Enterprise Value/Ebitda: 15.20
• 1Y Price Target: $18.75
• Price Target Upside: 9.59% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 8
• EPS Forecast (FY): 0.84
• Revenue Forecast (FY): $1.16B

• Rating: 69 Neutral
• Price Target: $19.00 ▲(11.05% Upside)

Sotera Health's overall stock score is driven by strong earnings call performance and positive technical indicators, reflecting robust revenue growth and improved financial stability. However, high valuation and financial performance concerns, such as low profitability and high debt levels, moderate the score.

Positive Factors

Revenue Growth

Sotera Health's consistent revenue growth indicates strong demand for its services and effective market penetration, supporting long-term business stability.

Debt Reduction

Reducing debt enhances financial flexibility and lowers interest expenses, improving the company's long-term financial health and operational resilience.

License Renewal

The long-term license renewal ensures a stable supply of critical materials, supporting sustained operations and long-term revenue streams in a key business segment.

Negative Factors

High Debt Levels

High debt levels can limit financial flexibility and increase risk, potentially impacting the company's ability to invest in growth opportunities and weather economic downturns.

Profitability Challenges

Low profitability margins indicate challenges in cost management and pricing power, which could hinder long-term earnings growth and shareholder returns.

Litigation Challenges

Litigation poses financial and reputational risks, potentially leading to significant legal expenses and impacting the company's operational focus and resources.

Sotera Health Business Overview & Revenue Model

Company Description

Sotera Health Company (SHC) is a leading global provider of sterilization and lab services, focusing on the healthcare, pharmaceutical, and medical device sectors. The company operates through its subsidiaries, which include Sterigenics, Nordion, and Gammex, offering a range of services such as gamma irradiation, ethylene oxide sterilization, and other related services. SHC is committed to ensuring the safety and efficacy of medical products through its state-of-the-art sterilization techniques and laboratory services.

How the Company Makes Money

Sotera Health generates revenue primarily through its sterilization services, which account for a significant portion of its earnings. The company charges clients in the healthcare and pharmaceutical industries for sterilizing medical devices and products, ensuring they meet safety standards. Additionally, SHC earns income from its lab services, including testing and validation for various medical products. Key revenue streams include long-term contracts with major manufacturers and partnerships with healthcare providers that require consistent sterilization services. The company also benefits from the increasing demand for sterilization due to the growing healthcare sector and regulatory requirements for product safety.

Sotera Health Financial Statement Overview

Summary

Sotera Health demonstrates solid revenue growth and strong gross profit margins. However, profitability and cash flow management need improvement. High debt levels are a concern, although return on equity is improving.

Income Statement

Sotera Health shows a consistent revenue growth trend, with a TTM revenue growth rate of 2.3%. The gross profit margin remains strong at 55.98%, indicating efficient cost management. However, the net profit margin is relatively low at 4.82%, suggesting room for improvement in profitability. The EBIT margin has decreased from previous years, indicating potential challenges in operational efficiency.

Balance Sheet

The company has a high debt-to-equity ratio, which poses a risk to financial stability. However, the return on equity is improving, reaching 11.79% in the TTM period, reflecting better utilization of equity. The equity ratio is low, indicating a high reliance on debt financing.

Cash Flow

Sotera Health's cash flow position is mixed. The operating cash flow to net income ratio is healthy at 0.70, but free cash flow has decreased significantly, with a negative growth rate of -23.3%. The free cash flow to net income ratio is moderate at 0.31, suggesting limited cash available for reinvestment or debt reduction.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.15B	1.10B	1.05B	1.00B	931.48M	818.16M
Gross Profit	643.98M	602.29M	577.16M	557.00M	518.67M	443.57M
EBITDA	426.72M	442.20M	406.83M	-17.41M	400.81M	319.96M
Net Income	55.42M	44.40M	51.38M	-233.57M	116.88M	-38.62M
Balance Sheet
Total Assets	3.19B	3.07B	3.13B	3.12B	2.79B	2.76B
Cash, Cash Equivalents and Short-Term Investments	301.03M	277.24M	296.41M	395.21M	106.92M	102.45M
Total Debt	2.28B	2.35B	2.33B	2.03B	1.83B	1.91B
Total Liabilities	2.64B	2.67B	2.69B	2.77B	2.20B	2.31B
Stockholders Equity	550.47M	404.91M	443.73M	350.24M	586.10M	452.30M
Cash Flow
Free Cash Flow	85.03M	45.09M	-362.71M	95.58M	179.38M	67.08M
Operating Cash Flow	238.22M	224.16M	-147.73M	277.96M	281.55M	120.58M
Investing Cash Flow	-150.31M	-179.00M	-214.91M	-181.90M	-159.83M	-158.69M
Financing Cash Flow	-97.31M	-50.56M	265.96M	197.76M	-117.29M	73.43M

Sotera Health Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 17.11
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SHC, the sentiment is Positive. The current price of 17.11 is above the 20-day moving average (MA) of 16.92, above the 50-day MA of 16.46, and above the 200-day MA of 13.80, indicating a bullish trend. The MACD of 0.17 indicates Negative momentum. The RSI at 60.30 is Neutral, neither overbought nor oversold. The STOCH value of 77.95 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SHC.

Sotera Health Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DGX	79 Outperform	$19.59B	20.66	13.69%	1.79%	13.74%	14.87%
QGEN	77 Outperform	$9.88B	24.59	11.29%	3.31%	5.32%	336.29%
ILMN	71 Outperform	$20.59B	30.20	31.20%	―	-2.39%	―
EXAS	70 Outperform	$19.32B	-19.15	-34.54%	―	14.47%	-353.69%
SHC	69 Neutral	$4.88B	88.96	10.86%	―	2.67%	-21.96%
CRL	60 Neutral	$9.70B	-126.73	-2.32%	―	-0.92%	-118.96%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

Sotera Health Corporate Events

Sotera Health Stockholders Sell 30 Million Shares

On November 6, 2025, Sotera Health Company and certain stockholders entered into an underwriting agreement with Goldman Sachs & Co. LLC for the sale of 30,000,000 shares of common stock. The shares were sold on November 10, 2025, by the stockholders, and Sotera Health did not receive any proceeds from this transaction.

Sotera Health Amends Credit Agreement for $1.42 Billion

On September 17, 2025, Sotera Health Company and its subsidiaries entered into an amendment to their First Lien Credit Agreement, originally dated December 13, 2019. This amendment involves refinancing term loans totaling approximately $1.42 billion, following a $75 million repayment using available cash, and includes a reduction in the interest rate spread by 0.50%. The repriced term loans, which mature on May 30, 2031, are subject to a 1.00% soft call premium for certain repricing transactions within six months of the amendment’s effective date, potentially impacting the company’s financial operations and cost of capital.