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Smiths Group (SMGZY)
OTHER OTC:SMGZY
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Smiths Group
(OTC:SMGZY)
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Rating:70Neutral
Price Target:
$35.00
▲(8.63% Upside)
Smiths Group's overall stock score reflects its strong financial performance and positive earnings call, which highlight robust growth and shareholder returns. However, the high valuation and mixed technical indicators slightly temper the outlook. The company's strategic initiatives and operational efficiency position it well for future growth, despite some market challenges.
Smiths Group (SMGZY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$10.31B
Dividend Yield1.9%
Average Volume (3M)2.10K
Price to Earnings (P/E)28.5
Beta (1Y)0.59
Revenue Growth-4.09%
EPS Growth22.06%
CountryUS
Employees15,750
SectorIndustrials
Sector Strength72
IndustryIndustrial - Machinery
Share Statistics
EPS (TTM)0.86
Shares Outstanding326,384,500
10 Day Avg. Volume1,290
30 Day Avg. Volume2,100
Financial Highlights & Ratios
PEG Ratio0.00
Price to Book (P/B)0.00
Price to Sales (P/S)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap1.08
Enterprise Value/Revenue3.55
Enterprise Value/Gross Profit9.52
Enterprise Value/Ebitda19.18
Forecast
1Y Price Target
$35.00Price Target Upside8.63% Upside
Rating ConsensusHold
Number of Analyst Covering1
Smiths Group Business Overview & Revenue Model
Company DescriptionSmiths Group plc operates as a technology company serving the medical technology, security and defense, general industrial, energy, and space and aerospace markets worldwide. It operates through John Crane, Smiths Detection, Flex-Tek, Smiths Interconnect, and Smiths Medical divisions. The John Crane division offers mechanical seals, seal support systems, hydrodynamic bearings, packing materials, power transmission couplings, and specialized filtration systems. The Smiths Detection division provides sensors and systems that detect and identify explosives, narcotics, weapons, chemical agents, biohazards, and contraband. The Flex-Tek division offers engineered components that heat and move fluids and gases for the aerospace, medical, industrial, construction, and domestic appliance markets. The Smiths Interconnect division provides specialized electronic and radio frequency board-level and waveguide devices, connectors, cables, test sockets, and sub-systems for applications in the security and defense, medical, general industrial, and space and aerospace markets. The Smiths Medical division offers infusion systems, vascular access, patient airway, and temperature management equipment products; and specialised devices in areas of diagnostic and emergency patient transport. The company was formerly known as Smiths Industries and changed its name to Smiths Group plc in 2000. Smiths Group plc was founded in 1851 and is headquartered in London, the United Kingdom.
How the Company Makes MoneySmiths Group generates revenue through the sale of its high-tech products and services across its various divisions. Key revenue streams include sales from medical devices, such as infusion systems and vascular access products, which cater to hospitals and healthcare providers. The company's detection division earns revenue from security screening equipment used in airports and other critical infrastructure, while the interconnect division provides specialized connectivity solutions for aerospace and defense applications. Additionally, Smiths Group leverages strategic partnerships with industry leaders and government contracts, particularly in defense and security, to enhance its market presence and drive sales. The company also invests in research and development to innovate and expand its product offerings, further contributing to its revenue growth.
Smiths Group Earnings Call Summary
Earnings Call Date:Sep 23, 2025
(Q4-2025)
| % Change Since: |
Next Earnings Date:Mar 20, 2026
Earnings Call Sentiment Positive
The earnings call reflects a strong financial performance with consecutive years of organic growth and increased shareholder returns. While there are challenges such as the cyber incident's impact on John Crane and a subdued U.S. construction market, the positive growth in Smiths Detection and Smiths Interconnect, along with operational improvements and strategic plans, provide a robust outlook.Q4-2025 Updates
Positive Updates
Consistent Organic Revenue Growth
Fiscal year 2025 marks the fourth consecutive year of organic revenue growth, with group organic revenue up 8.9%, surpassing the 6% to 8% guidance.
Expansion of Operating Profit Margins
Operating profit grew 13.1% on an organic basis, with a 60 basis point margin expansion to 17.4%, at the top end of the guidance range.
Strong Return on Capital Employed
Return on capital employed increased by 170 basis points to 18.1%, driven by profit growth and efficient capital allocation.
Significant Shareholder Returns
Smiths returned GBP 460 million to shareholders through dividends and a share buyback program, amounting to GBP 1.7 billion over the past 4 years.
Smiths Detection's Robust Performance
Revenue increased 15.2% organically, with significant growth in aviation and notable contract wins in ports and borders.
Smiths Interconnect's Strong Growth
Reported a 22.5% organic sales increase, driven by strength in semiconductor test business and aerospace and defense revenue.
Negative Updates
Impact of Cyber Incident on John Crane
The cyber incident caused operational challenges, particularly affecting the aftermarket and delaying recovery.
Nonmaterial Balance Sheet Overstatement in Flex-Tek
Identified an isolated GBP 8 million in-year impact and a GBP 15 million statutory profit impact from prior years.
Subdued U.S. Construction Market
Flex-Tek's Industrial segment growth was challenged by conditions in the U.S. construction market.
Company Guidance
In the recent call, Smiths Group exceeded its fiscal year 2025 guidance, achieving an organic revenue growth of 8.9%, surpassing the expected 6% to 8% range. They expanded operating profit margins by 60 basis points to 17.4%, at the top end of the 40 to 60 basis points guidance. The company also marked a 5.1% increase in dividends, continuing a 74-year streak of dividend payments. Smiths executed three accretive acquisitions and progressed the separation of Smiths Interconnect and Smiths Detection, reporting Interconnect as discontinued operations. Looking ahead, the company anticipates 4% to 6% organic revenue growth for fiscal year 2026, with ongoing margin expansion. Earnings per share rose by 14.8%, and the return on capital employed increased by 170 basis points to 18.1%. Smiths also maintained a strong cash conversion rate of 99%, with a free cash flow of GBP 336 million, reflecting their disciplined capital allocation and strategic focus on sustainable growth and shareholder value.Smiths Group Financial Statement Overview
Summary
Smiths Group presents a strong financial profile with consistent revenue growth, stable profitability, and effective cash flow management. The balance sheet shows a good balance between debt and equity, indicating a robust financial health.Income Statement
Smiths Group has shown consistent growth in revenue and profitability. The gross profit margin is strong, reflecting efficient cost management. The net profit margin has improved steadily, indicating increased profitability. The revenue growth rate is healthy, and both EBIT and EBITDA margins are stable, indicating operational efficiency.65
Positive
Balance Sheet
The balance sheet is solid with a reasonable debt-to-equity ratio, suggesting manageable leverage. The return on equity is satisfactory, indicating effective use of equity to generate profits. The equity ratio is strong, reflecting a stable financial position with a good proportion of equity financing.70
Positive
Cash Flow
The company's cash flow is robust, with a steady increase in free cash flow, indicating strong cash generation capabilities. The operating cash flow to net income ratio is healthy, suggesting efficient cash generation from operations. The free cash flow to net income ratio is favorable, highlighting effective cash management.75
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 3.13B | 2.92B | 3.13B | 3.04B | 2.57B | 2.41B |
| Gross Profit | 1.17B | 410.00M | 1.17B | 1.12B | 961.00M | 915.00M |
| EBITDA | 580.00M | 535.00M | 580.00M | 580.00M | 287.00M | 430.00M |
| Net Income | 250.00M | 292.00M | 250.00M | 231.00M | 1.03B | 284.00M |
Balance Sheet | ||||||
| Total Assets | 4.23B | 4.01B | 4.23B | 4.36B | 5.22B | 5.34B |
| Cash, Cash Equivalents and Short-Term Investments | 459.00M | 195.00M | 459.00M | 285.00M | 1.06B | 405.00M |
| Total Debt | 659.00M | 667.00M | 659.00M | 654.00M | 1.17B | 1.50B |
| Total Liabilities | 1.98B | 1.95B | 1.98B | 1.95B | 2.50B | 2.91B |
| Stockholders Equity | 2.23B | 2.04B | 2.23B | 2.38B | 2.70B | 2.40B |
Cash Flow | ||||||
| Free Cash Flow | 332.00M | 384.00M | 332.00M | 212.00M | 191.00M | 418.00M |
| Operating Cash Flow | 418.00M | 456.00M | 418.00M | 293.00M | 279.00M | 535.00M |
| Investing Cash Flow | 39.00M | -160.00M | 39.00M | -108.00M | 1.25B | -205.00M |
| Financing Cash Flow | -269.00M | -517.00M | -269.00M | -945.00M | -985.00M | -239.00M |
Smiths Group Technical Analysis
Positive
32.22
Price Trends
31.36
Positive
30.78
Positive
27.60
Positive
Market Momentum
0.11
Negative
60.71
Neutral
6.29
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SMGZY, the sentiment is Positive. The current price of 32.22 is above the 20-day moving average (MA) of 31.38, above the 50-day MA of 31.36, and above the 200-day MA of 27.60, indicating a bullish trend. The MACD of 0.11 indicates Negative momentum. The RSI at 60.71 is Neutral, neither overbought nor oversold. The STOCH value of 6.29 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SMGZY.
Smiths Group Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $9.54B | 26.99 | 24.94% | 1.38% | 2.92% | -9.78% | |
73 Outperform | $9.72B | 19.35 | 27.60% | 1.95% | -3.53% | -7.46% | |
73 Outperform | $11.30B | 31.64 | 14.59% | ― | 9.69% | 54.29% | |
72 Outperform | $10.43B | 34.20 | 18.23% | 0.49% | 3.01% | 27.13% | |
70 Neutral | $10.31B | 28.55 | 12.77% | 1.90% | -4.09% | 22.06% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
62 Neutral | $9.54B | 38.23 | 3.84% | 1.00% | -7.88% | ― |
* Industrials Sector Average
SMGZY
Smiths Group
32.22
11.67
56.79%
DCI
Donaldson Company
82.77
8.84
11.96%
GNRC
Generac Holdings
190.49
23.84
14.31%
RRX
Regal Rexnord
140.44
-30.81
-17.99%
AOS
A. O. Smith Corporation
69.71
-7.37
-9.56%
CR
Crane Company
183.74
26.04
16.51%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.