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Steris plc (STE)
NYSE:STE
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Steris (STE) AI Stock Analysis

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STE

Steris

(NYSE:STE)

Rating:79Outperform
Price Target:
$285.00
▲(17.76% Upside)
Steris's strong financial performance and positive earnings call sentiment are the most significant factors contributing to its overall score. The technical analysis supports a bullish outlook, although the high valuation suggests caution. The recent corporate events reflect strategic alignment and shareholder confidence, further supporting the stock's positive outlook.
Positive Factors
Financial Performance
STE's F1Q26 revenue and EPS beat consensus, indicating strong financial performance.
Global Expansion
Management sees plenty of assets across the globe to look at, indicating confidence in international expansion.
Revenue Growth
Organic revenue growth improved to 7.8% in F1Q26 from 5.9% in F4Q25, driven by stronger Healthcare and Life Sciences growth.
Negative Factors
Healthcare Policy
Potential healthcare policy changes could disrupt Steris's business, with millions losing coverage and impacting procedure volumes.
Macroeconomic Factors
Uncertainties in macroeconomic and political factors are expected to negatively impact Steris's revenue growth projections for the coming years.
Tariff Impact
The tariff impact in 2Q25 was $9M, affecting the Healthcare business and increasing the expected FY26 tariff impact to $45M.

Steris (STE) vs. SPDR S&P 500 ETF (SPY)

Steris Business Overview & Revenue Model

Company DescriptionSTERIS plc provides infection prevention and other procedural products and services worldwide. It operates through four segments: Healthcare, Applied Sterilization Technologies, Life Sciences, and Dental. The Healthcare segment offers cleaning chemistries and sterility assurance products; automated endoscope reprocessing system and tracking products; accessories for gastrointestinal (GI) procedures, washers, sterilizers, and other pieces of capital equipment for the operation of a sterile processing department; and equipment used directly in the operating room, including surgical tables, lights, and connectivity solutions, as well as equipment management services. It also provides capital equipment installation, maintenance, upgradation, repair, and troubleshooting services; preventive maintenance programs and repair services; instrument and endoscope repair and maintenance services; and custom process improvement consulting and outsourced instrument sterile processing services. The Applied Sterilization Technologies segment provides contract sterilization and testing services for medical device and pharmaceutical manufacturers through a network of approximately 50 contract sterilization and laboratory facilities. The Life Sciences segment designs, manufactures and sells consumable products, such as formulated cleaning chemistries, barrier and sterility assurance products, steam and vaporized hydrogen peroxide sterilizers, and washer disinfectors. This segment also offers equipment installation, maintenance, upgradation, repair, and troubleshooting services; and preventive maintenance programs and repair services. The Dental segment provides hand and powered dental instruments, infection control products, personal protective equipment, and water quality products for dental suite. The company serves its products and services to hospitals, other healthcare providers, and pharmaceutical manufacturers. The company was founded in 1985 and is based in Dublin, Ireland.
How the Company Makes MoneySteris generates revenue through multiple key streams. The Healthcare Products segment contributes significantly by selling sterilization equipment, endoscope reprocessing products, surgical instruments, and consumables. The Healthcare Services segment derives income from service contracts for maintaining and repairing medical equipment, as well as consulting services that help healthcare facilities optimize their operations and meet regulatory requirements. The Life Sciences segment provides products and services to pharmaceutical and biotechnology companies, including sterilization services for critical components. Additionally, Steris benefits from strategic partnerships with healthcare institutions and companies that enhance its market reach and capabilities, alongside ongoing innovation in its product offerings to meet evolving customer needs.

Steris Key Performance Indicators (KPIs)

Any
Any
Operating Margin by Segment
Operating Margin by Segment
Measures the efficiency of each segment in converting revenue into profit, indicating competitive strengths or weaknesses and potential areas for cost optimization.
Chart InsightsSteris's Healthcare segment shows steady margin improvement, reaching 25% by the end of 2024, supported by volume, pricing, and productivity gains. The AST segment, despite strong revenue growth, faces margin pressures from energy and labor costs. Life Sciences margins have improved significantly, aided by strategic divestitures. The Dental segment has been phased out, reflecting a strategic shift. Overall, Steris's focus on core segments and operational efficiencies is driving margin expansion, although challenges like tariff costs and legal settlements may impact future cash flow.
Data provided by:Main Street Data

Steris Earnings Call Summary

Earnings Call Date:Aug 06, 2025
(Q1-2026)
|
% Change Since: |
Next Earnings Date:Nov 05, 2025
Earnings Call Sentiment Positive
The earnings call for STERIS plc highlighted strong revenue growth across all segments, with improved margins and a solid start to fiscal 2026. However, increased tariff costs and an unchanged earnings outlook despite a strong quarter are challenges that the company faces. The overall sentiment is positive, with more highlights than lowlights, reflecting strong operational performance.
Q1-2026 Updates
Positive Updates
Strong Revenue Growth
Total as-reported revenue grew by 9% with constant currency organic revenue growth at 8% for the quarter. Gross margin increased by 20 basis points to 45.3%.
Healthcare Segment Performance
Healthcare constant currency organic revenue grew 8% with a 14% underlying order growth and a backlog of just over $400 million. EBIT margins increased by 10 basis points to 24.2%.
AST Segment Growth
AST saw a 10% increase in constant currency organic revenue, with services growing by 12%. EBIT margins for AST increased by 150 basis points to 48.6%.
Life Sciences Segment Improvement
Life Sciences group saw a 4% increase in constant currency organic revenue, with Consumables growing by 8% and margins increasing by 260 basis points.
Positive Earnings and Cash Flow
Net income from continuing operations was $231.2 million, and adjusted earnings per diluted share improved by 15% to $2.34. Free cash flow was strong at $327 million for the quarter.
Consistent Dividend Growth
STERIS announced its 20th consecutive year of dividend increases with a 10% increase to $0.63 per quarter.
Negative Updates
Increased Tariff Costs
Tariff costs increased by $15 million over the last quarter, with additional tariffs on metals like steel, aluminum, and copper affecting costs.
Healthcare Segment Tariff Impact
The Healthcare segment was primarily impacted by approximately $9 million in tariff costs.
Unchanged Earnings Outlook Despite Strong Start
Despite strong performance, the earnings outlook remains unchanged at $9.90 to $10.15 per share, reflecting $45 million in tariff costs.
Company Guidance
In STERIS plc's first-quarter conference call for fiscal year 2026, the company reported a robust financial performance, with total revenue increasing by 9% and constant currency organic revenue growing by 8%, driven by volume and a 230 basis point price increase. The gross margin rose by 20 basis points to 45.3%, and the EBIT margin improved by 50 basis points to 22.8% of revenue. The adjusted effective tax rate was 23.5%, while net income from continuing operations reached $231.2 million. Adjusted earnings per diluted share rose by 15% to $2.34. The company maintained its earnings guidance at $9.90 to $10.15 per share despite revising its revenue growth outlook to 8% to 9% due to favorable currency shifts. STERIS also increased its free cash flow guidance by $50 million to $820 million for the fiscal year, reflecting a strong start and improvements in working capital. Additionally, STERIS announced a 10% increase in its quarterly dividend, marking its 20th consecutive year of dividend growth. Capital expenditures for the quarter were $94 million, with depreciation and amortization at $119 million, and total debt was reduced to $1.9 billion, with a gross debt to EBITDA ratio of 1.2x.

Steris Financial Statement Overview

Summary
Steris demonstrates strong financial performance with consistent revenue growth and robust profitability margins. The company maintains a healthy cash flow position, supporting its operational and strategic initiatives. While the debt levels are manageable, continued focus on maintaining profitability and cash flow generation will be crucial for sustaining growth and financial stability.
Income Statement
85
Very Positive
Steris demonstrates strong financial performance with consistent revenue growth and robust profitability margins. The TTM data shows a gross profit margin of 44.13% and a net profit margin of 11.61%, indicating efficient cost management and profitability. Revenue growth has been steady, with a 2.04% increase in the TTM period. The EBIT and EBITDA margins are healthy at 16.60% and 23.12%, respectively, reflecting effective operational management.
Balance Sheet
78
Positive
The balance sheet reflects a solid financial position with a manageable debt-to-equity ratio of 0.27 in the TTM period, indicating prudent leverage. The return on equity is 9.73%, showcasing effective use of equity to generate profits. The equity ratio stands at 66.99%, highlighting a strong equity base relative to total assets, which enhances financial stability.
Cash Flow
82
Very Positive
Steris's cash flow performance is commendable, with a significant free cash flow growth rate of 16.81% in the TTM period. The operating cash flow to net income ratio is 1.36, indicating strong cash generation relative to net income. The free cash flow to net income ratio is 0.72, demonstrating efficient conversion of net income into free cash flow, supporting future growth and debt servicing.
BreakdownTTMDec 2025Dec 2024Dec 2023Dec 2022Dec 2021
Income Statement
Total Revenue5.57B5.46B5.14B4.54B4.22B3.11B
Gross Profit2.46B2.40B2.22B1.98B1.88B1.34B
EBITDA1.41B1.36B1.41B1.34B1.01B773.95M
Net Income646.64M614.64M378.24M107.03M243.89M397.40M
Balance Sheet
Total Assets10.40B10.15B11.06B10.82B11.42B6.57B
Cash, Cash Equivalents and Short-Term Investments279.70M171.70M207.02M208.36M348.32M220.53M
Total Debt2.07B2.20B3.38B3.25B3.28B1.80B
Total Liabilities3.44B3.53B4.75B4.73B4.88B2.68B
Stockholders Equity6.96B6.60B6.30B6.08B6.53B3.88B
Cash Flow
Free Cash Flow908.74M778.00M612.95M394.98M397.25M450.38M
Operating Cash Flow1.26B1.15B973.27M756.95M684.81M689.64M
Investing Cash Flow-407.56M388.77M-887.36M-383.33M-666.56M-1.15B
Financing Cash Flow-786.53M-1.57B-85.19M-498.72M115.83M345.62M

Steris Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price242.02
Price Trends
50DMA
236.08
Positive
100DMA
234.74
Positive
200DMA
225.77
Positive
Market Momentum
MACD
3.39
Positive
RSI
50.70
Neutral
STOCH
13.63
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For STE, the sentiment is Neutral. The current price of 242.02 is below the 20-day moving average (MA) of 243.37, above the 50-day MA of 236.08, and above the 200-day MA of 225.77, indicating a neutral trend. The MACD of 3.39 indicates Positive momentum. The RSI at 50.70 is Neutral, neither overbought nor oversold. The STOCH value of 13.63 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for STE.

Steris Risk Analysis

Steris disclosed 36 risk factors in its most recent earnings report. Steris reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Steris Peers Comparison

Overall Rating
UnderperformOutperform
Sector (51)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
79
Outperform
$24.14B36.699.73%0.94%2.47%63.68%
78
Outperform
$16.30B33.139.20%2.03%5.78%61.52%
76
Outperform
$23.93B103.4419.18%25.99%-40.46%
74
Outperform
$21.02B25.846.52%0.91%4.11%-14.43%
68
Neutral
$29.54B52.7422.83%9.30%-14.95%
56
Neutral
$26.11B-7.10%3.27%-0.76%-55.03%
51
Neutral
$7.86B-0.33-41.57%2.23%23.26%-2.03%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
STE
Steris
242.02
3.99
1.68%
DXCM
Dexcom
74.30
4.48
6.42%
PODD
Insulet
344.92
132.41
62.31%
PHG
Koninklijke Philips
27.06
-1.84
-6.37%
SNN
Smith & Nephew Snats
36.90
6.90
23.00%
ZBH
Zimmer Biomet Holdings
105.01
-8.42
-7.42%

Steris Corporate Events

Executive/Board ChangesShareholder MeetingsBusiness Operations and StrategyFinancial Disclosures
STERIS Announces CFO Resignation and Successor
Positive
Aug 6, 2025

On July 31, 2025, STERIS announced the resignation of Michael J. Tokich as Chief Financial Officer, effective August 18, 2025, with Karen Burton appointed as his successor. This transition is part of a broader strategic shift, including a strong financial performance in the first quarter of fiscal 2026, with a 9% increase in total revenue and improved earnings per share. The company also updated its fiscal 2026 outlook, anticipating an 8-9% revenue increase due to favorable foreign currency conditions, despite challenges like tariffs and healthcare costs. Additionally, STERIS’s annual meeting saw the election of new board members and the approval of various shareholder proposals, reflecting strong shareholder engagement and strategic alignment.

Executive/Board ChangesShareholder Meetings
Steris Announces Board Member Retirement
Neutral
Jul 3, 2025

On July 1, 2025, Dr. Richard Steeves announced his retirement from the Board of Directors of STERIS plc, effective at the company’s Annual General Meeting on July 31, 2025. Dr. Steeves’ retirement is amicable and not due to any disagreements with the company, and he is thanked for his decade of service.

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.Date of analysis: Aug 27, 2025