Smith & Nephew Snats (SNN) AI Stock Analysis

• Market Cap: $13.27B
• Dividend Yield: 2.42%
• Average Volume (3M): 1.08M
• Price to Earnings (P/E): 31.9
• Beta (1Y): 0.61
• Revenue Growth: 5.16%
• EPS Growth: 56.79%
• Country: US
• Employees: 17,349
• Sector: Healthcare
• Sector Strength: 37
• Industry: Medical - Devices
• EPS (TTM): 0.94
• Shares Outstanding: 437,978,500
• 10 Day Avg. Volume: 1,512,041
• 30 Day Avg. Volume: 1,084,411
• PEG Ratio: 7.93
• Price to Book (P/B): 2.44
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 70.17
• Enterprise Value/Market Cap: 1.17
• Enterprise Value/Revenue: 0.92
• Enterprise Value/Gross Profit: 3.85
• Enterprise Value/Ebitda: 4.57
• 1Y Price Target: $28.63
• Price Target Upside: -7.44% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 2

• Rating: 80 Outperform
• Price Target: $35.00 ▲(13.16%Upside)

Smith & Nephew Snats is well-positioned due to strong financial performance and positive earnings call sentiment, highlighting growth and strategic execution. The technical analysis indicates a strong upward trend, although overbought conditions may pose short-term risks. The high P/E ratio suggests potential overvaluation, but the dividend yield adds some appeal for income-focused investors.

Positive Factors

Financial Performance

SNN delivered a solid Q1 overall, slightly beating consensus and maintaining its guidance through the P&L.

Market Expansion

SNN notes growth in the other emerging markets was much stronger at +14.7%.

Negative Factors

Geopolitical Risks

SNN anticipates a $15-$20M impact from potential US tariffs but expects to absorb this range into its current guidance.

Regional Performance

China remained a headwind to the tune of 280bps on group underlying revenue growth as VBP impacts on Sports Med and reduced distributor inventory purchasing in Recon persisted.

Supply Chain Challenges

China remains a key hurdle in Ortho and Sports Medicine until mid-year when SNN believes Ortho inventory levels should normalize.

Smith & Nephew Snats Business Overview & Revenue Model

Company Description

Smith & Nephew is a global medical technology company headquartered in the United Kingdom, operating in the healthcare sector. The company specializes in developing, manufacturing, and marketing advanced medical devices with a focus on orthopedics, wound management, and sports medicine. Smith & Nephew's core products include joint reconstruction implants, trauma fixation devices, surgical robotics, and wound care solutions, serving healthcare professionals and patients worldwide.

How the Company Makes Money

Smith & Nephew generates revenue primarily through the sale of its medical devices and technologies. The company's revenue model is driven by key segments: Orthopedics, which includes hip and knee implants as well as trauma and extremities products; Sports Medicine & ENT, offering products for minimally invasive surgery of the joints and ears, nose, and throat; and Advanced Wound Management, providing solutions for wound care and infection prevention. Revenue streams are bolstered by strategic partnerships with healthcare providers, hospitals, and distributors, as well as investments in research and development to drive innovation. Additionally, Smith & Nephew's global presence allows it to capitalize on diverse markets, leveraging its extensive sales network to reach customers in over 100 countries.

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

Smith & Nephew Snats Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 30.93
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SNN, the sentiment is Positive. The current price of 30.93 is above the 20-day moving average (MA) of 30.19, above the 50-day MA of 29.52, and above the 200-day MA of 27.10, indicating a bullish trend. The MACD of 0.23 indicates Positive momentum. The RSI at 60.75 is Neutral, neither overbought nor oversold. The STOCH value of 55.22 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SNN.

Smith & Nephew Snats Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SNN	80 Outperform	$13.27B	31.95	7.86%	2.42%	5.16%	56.79%
ZBH	74 Outperform	$19.10B	21.39	7.31%	0.99%	3.30%	-2.39%
STE	71 Outperform	$22.19B	35.55	9.46%	1.02%	0.32%	64.36%
PODD	70 Outperform	$20.00B	50.56	37.92%	―	23.49%	71.25%
GMED	69 Neutral	$7.63B	38.81	4.63%	―	32.26%	112.87%
PHG	51 Neutral	$23.70B	―	-7.10%	3.54%	-0.76%	-55.03%
Sector *	50 Neutral	AU$2.61B	3.12	-57.47%	2.45%	36.73%	13.67%