Smith & Nephew Snats (SNN) AI Stock Analysis

• Market Cap: $15.32B
• Dividend Yield: 2.13%
• Average Volume (3M): 675.38K
• Price to Earnings (P/E): 31.7
• Beta (1Y): 0.63
• Revenue Growth: 5.78%
• EPS Growth: 61.52%
• Country: US
• Employees: 17,349
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Devices
• EPS (TTM): 0.86
• Shares Outstanding: 430,731,050
• 10 Day Avg. Volume: 779,420
• 30 Day Avg. Volume: 675,385
• PEG Ratio: -1.21
• Price to Book (P/B): 2.05
• Price to Sales (P/S): 1.85
• P/FCF Ratio: 17.78
• Enterprise Value/Market Cap: 1.05
• Enterprise Value/Revenue: 2.69
• Enterprise Value/Gross Profit: 3.84
• Enterprise Value/Ebitda: 11.16
• 1Y Price Target: $35.33
• Price Target Upside: -0.25% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 2

• Rating: 78 Outperform
• Price Target: $41.00 ▲(15.75% Upside)

Smith & Nephew Snats' strong financial performance and positive earnings call are the most significant factors driving the score. The stock's bullish technical indicators are tempered by overbought signals, and the valuation suggests it may be overvalued. Despite challenges in emerging markets and potential tariff impacts, the company's strategic initiatives and share buyback plan reflect confidence in sustaining growth.

Positive Factors

Revenue Growth

Consistent revenue growth across all regions and business units indicates strong market demand and effective business strategies, supporting long-term financial health.

Cash Flow Generation

Robust cash flow generation enhances financial flexibility, enabling strategic investments and shareholder returns, which are crucial for sustainable growth.

Product Innovation

Growth in Advanced Wound Management reflects successful product innovation and market adaptation, strengthening competitive positioning in the medical technology sector.

Negative Factors

Emerging Markets Challenges

Declines in emerging markets, particularly China, could limit growth opportunities and revenue diversification, impacting long-term expansion strategies.

Tariff Impacts

Tariff-related costs can erode profit margins and increase operational expenses, posing a risk to financial performance and competitiveness.

Reimbursement Headwinds

Potential changes in reimbursement policies may affect sales and profitability, particularly in Advanced Wound Management, challenging future revenue streams.

Smith & Nephew Snats Business Overview & Revenue Model

Company Description

Smith & Nephew plc, together with its subsidiaries, develops, manufactures, markets, and sells medical devices worldwide. The company offers knee implant products for knee replacement procedures; hip implants for the reconstruction of hip joints; and trauma and extremities products that include internal and external devices used in the stabilization of severe fractures and deformity correction procedures. It also provides sports medicine joint repair products for surgeons, including instruments, technologies, and implants necessary to perform minimally invasive surgery of the joints, such as the repair of soft tissue injuries and degenerative conditions of the knee, hip, and shoulder, as well as meniscal repair systems. In addition, the company offers arthroscopic enabling technologies comprising fluid management equipment for surgical access, high-definition cameras, digital image capture, scopes, light sources, and monitors to assist with visualization inside the joints, radio frequency, electromechanical and mechanical tissue resection devices, and hand instruments for removing damaged tissue; and ear, nose, and throat solutions. Further, it provides advanced wound care products for the treatment and prevention of acute and chronic wounds, which comprise leg, diabetic and pressure ulcers, burns, and post-operative wounds; advanced wound bioactives, including biologics and other bioactive technologies for debridement and dermal repair/regeneration, as well as regenerative medicine products including skin, bone graft, and articular cartilage substitutes; and advanced wound devices, such as traditional and single-use negative pressure wound therapy, and hydrosurgery systems. It primarily serves the healthcare providers. Smith & Nephew plc was founded in 1856 and is headquartered in Watford, the United Kingdom.

How the Company Makes Money

Smith & Nephew Snats generates revenue through multiple streams, primarily from the sale of medical devices and advanced wound care products. The company has a diverse portfolio that includes high-margin products in its orthopedics and wound management segments, which contribute significantly to overall sales. Additionally, SNN benefits from ongoing partnerships with healthcare providers and institutions, ensuring a steady demand for its products. The company also engages in research and development initiatives to innovate and expand its product lines, further driving revenue growth. Strategic collaborations with hospitals and surgical centers enhance market penetration and access to new customer bases, supporting its earnings potential.

Smith & Nephew Snats Financial Statement Overview

Summary

Smith & Nephew Snats demonstrates strong financial health with impressive revenue and profit growth, solid profitability margins, and efficient cash flow management. Despite a slight increase in leverage, the company's balanced capital structure and improved returns to shareholders position it well in the Medical Equipment & Supplies industry.

Income Statement

Smith & Nephew Snats has shown consistent revenue growth with a notable increase of 4.7% from 2023 to 2024. The gross profit margin stands strong at 69.6%, highlighting effective cost management. The net profit margin improved significantly from 4.7% in 2023 to 7.1% in 2024, demonstrating enhanced profitability. EBIT and EBITDA margins increased to 11.3% and 21.3% respectively, reflecting operational efficiency improvements.

Balance Sheet

The company maintains a solid equity position with an equity ratio of 50.8% in 2024, indicating a balanced capital structure. However, the debt-to-equity ratio increased slightly to 0.63, suggesting a cautious approach to leverage. ROE improved to 7.8%, signifying better returns to shareholders, driven by increased net income.

Cash Flow

Smith & Nephew Snats experienced a robust free cash flow growth of 234.8%, indicating strong cash generation capabilities. The operating cash flow to net income ratio of 2.40 reflects efficient cash management. The free cash flow to net income ratio of 1.47 further supports the company’s strong cash flow position.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	5.97B	5.81B	5.55B	5.21B	5.21B	4.56B
Gross Profit	4.18B	4.05B	3.82B	3.67B	3.67B	3.16B
EBITDA	1.44B	1.24B	979.00M	943.00M	1.24B	866.00M
Net Income	493.64M	412.00M	263.00M	223.00M	524.00M	448.00M
Balance Sheet
Total Assets	10.68B	10.35B	9.99B	9.97B	10.92B	11.01B
Cash, Cash Equivalents and Short-Term Investments	675.41M	619.00M	302.00M	350.00M	1.29B	1.76B
Total Debt	3.45B	3.32B	3.08B	2.87B	3.34B	3.69B
Total Liabilities	5.15B	5.09B	4.77B	4.71B	5.35B	5.73B
Stockholders Equity	5.53B	5.26B	5.22B	5.26B	5.57B	5.28B
Cash Flow
Free Cash Flow	799.32M	606.00M	181.00M	110.00M	469.00M	492.00M
Operating Cash Flow	1.15B	987.00M	608.00M	468.00M	877.00M	935.00M
Investing Cash Flow	-345.22M	-569.00M	-448.00M	-472.00M	-691.00M	-606.00M
Financing Cash Flow	-676.96M	-86.00M	-200.00M	-926.00M	-645.00M	1.16B

Smith & Nephew Snats Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 35.42
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SNN, the sentiment is Neutral. The current price of 35.42 is below the 20-day moving average (MA) of 37.20, below the 50-day MA of 35.50, and above the 200-day MA of 29.30, indicating a neutral trend. The MACD of -0.05 indicates Positive momentum. The RSI at 38.56 is Neutral, neither overbought nor oversold. The STOCH value of 8.48 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SNN.

Smith & Nephew Snats Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
STE	79 Outperform	24.53B	37.02	9.29%	0.94%	2.47%	63.68%
SNN	78 Outperform	$15.32B	31.70	9.20%	2.13%	5.78%	61.52%
PODD	76 Outperform	22.38B	96.78	16.14%	―	25.99%	-40.46%
GMED	76 Outperform	7.52B	21.50	8.30%	―	17.43%	775.48%
ZBH	74 Outperform	19.46B	23.61	6.57%	0.98%	4.11%	-14.43%
PHG	56 Neutral	25.57B	-32.85	-5.85%	3.30%	-0.76%	-55.03%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%