Smith & Nephew Snats (SNN) AI Stock Analysis

• Market Cap: $12.27B
• Dividend Yield: 2.57%
• Average Volume (3M): 997.85K
• Price to Earnings (P/E): 29.7
• Beta (1Y): 0.64
• Revenue Growth: 4.58%
• EPS Growth: 55.99%
• Country: US
• Employees: 17,349
• Sector: Healthcare
• Sector Strength: 70
• Industry: Medical - Devices
• EPS (TTM): 0.94
• Shares Outstanding: 437,963,900
• 10 Day Avg. Volume: 760,608
• 30 Day Avg. Volume: 997,853
• PEG Ratio: 0.53
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.13
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 3.43
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $28.80
• Price Target Upside: 2.78% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

Smith & Nephew Snats receives a solid overall score of 77.0, driven by strong financial performance and positive earnings call sentiment. The company's impressive revenue and profit growth, coupled with innovation-driven strategies, contribute to a favorable outlook. However, high valuation ratios and technical analysis indicators suggest caution. Challenges in the China market and input cost pressures in Orthopedics remain key risks.

Positive Factors

Financial Performance

SNN posted an encouraging Q4 with top line beating expectations as US Recon performance trended in the right direction and SNN saw +23.9% growth in Other Recon with a record quarter of CORI placements.

New Product Launches

SNN's new launches are leveraging higher-growth end markets, including 510(K) clearance for its shorter hip stem CATALYSTEM and its TOTAL ANKLE Patient-Matched Guides.

Orthopedics Growth

Orthopedics grew with positive US traction in knees/hips, driven by growth in the US positive for hips and knees turning positive.

Negative Factors

China Market Challenges

Lingering China Recon distributor inventory impacts are expected to affect performance.

Market Competition

US Ortho growth still remains muted at a time when the market is only getting more competitive as others partner or launch more robust hip and trauma offerings.

Revenue Expectations

SNN posted a challenged Q as it missed revenue expectations, lowered its 2024 top line and margin guidance, and also lowered its 2025 margin guidance.

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 generates revenue through the sale of its medical devices and related services. Its key revenue streams include the Orthopedics segment, which provides joint replacement systems and trauma devices; the Sports Medicine & ENT segment, offering products for minimally invasive surgery of the joints and ear, nose, and throat procedures; and the Advanced Wound Management segment, delivering products that promote wound healing and tissue repair. Significant partnerships with hospitals, clinics, and healthcare providers, along with investments in research and development, enhance SNN's ability to maintain and expand its market presence. The company's international reach allows it to capitalize on diverse healthcare markets, contributing to its overall earnings.

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
	EBIT
657.00M	425.00M	315.00M	593.00M	295.00M
	EBITDA
1.24B	979.00M	943.00M	1.24B	866.00M
	Net Income Common Stockholders
412.00M	263.00M	223.00M	524.00M	448.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
619.00M	302.00M	350.00M	1.29B	1.76B
	Total Assets
10.35B	9.99B	9.97B	10.92B	11.01B
	Total Debt
3.32B	3.08B	2.87B	3.34B	3.69B
	Net Debt
2.70B	2.78B	2.52B	2.05B	1.93B
	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: 28.02
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

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 28.02 is above the 20-day moving average (MA) of 26.36, above the 50-day MA of 27.38, and above the 200-day MA of 27.10, indicating a bullish trend. The MACD of -0.03 indicates Negative momentum. The RSI at 61.35 is Neutral, neither overbought nor oversold. The STOCH value of 85.89 is Negative, 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	77 Outperform	$12.27B	29.69	7.82%	2.57%	4.58%	55.99%
STE	76 Outperform	$22.08B	47.66	9.61%	1.00%	-0.17%	-17.34%
GMED	74 Outperform	$11.48B	96.41	2.52%	―	60.62%	-35.88%
PODD	74 Outperform	$17.84B	43.88	43.03%	―	22.07%	101.95%
ZBH	65 Neutral	$20.39B	23.25	7.24%	0.93%	3.84%	-9.29%
Sector *	52 Neutral	$5.38B	3.59	-41.63%	2.87%	17.72%	1.87%
PHG	49 Neutral	$23.53B	―	-7.10%	―	-0.76%	-55.03%