Smith & Nephew PLC
LSE:SN

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Smith & Nephew PLC Logo
Smith & Nephew PLC
LSE:SN
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Price: 986.8 GBX 1.11% Market Closed
Market Cap: 8.6B GBX
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Intrinsic Value

The intrinsic value of one SN stock under the Base Case scenario is 1 458.57 GBX. Compared to the current market price of 986.8 GBX, Smith & Nephew PLC is Undervalued by 32%.

The Intrinsic Value is calculated as the average of DCF and Relative values:

SN Intrinsic Value
1 458.57 GBX
Undervaluation 32%
Intrinsic Value
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Smith & Nephew PLC

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Backtest Conclusion
Very Attractive
Current Valuation
+45%
Avg Valuation
-12%
Worst Valuation
-49%
Best Valuation
+45%

Stock is trading at its lowest valuation over the past 5 years.

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Fundamental Analysis

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Business Breakdown

Smith & Nephew PLC has a rich history dating back to 1856, evolving from a small medical supplies company in the UK to a prominent global player in the medical technology industry. The company specializes in advanced wound management, surgical devices, and orthopedic reconstruction, driven by a mission to restore people’s bodies and health, enabling them to live life to the fullest. As an investor, you’ll find that Smith & Nephew stands out for its commitment to innovation, consistently investing a significant portion of its revenue into research and development. This dedication results in a robust pipeline of cutting-edge products, such as its highly regarded advanced wound care solutions a...

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Financials
Annual
Quarterly
TTM
Annual
Quarterly
TTM

Balance Sheet Decomposition
Smith & Nephew PLC

Current Assets 4.5B
Cash & Short-Term Investments 568m
Receivables 1.4B
Other Current Assets 2.5B
Non-Current Assets 6.1B
Long-Term Investments 24m
PP&E 1.4B
Intangibles 4.2B
Other Non-Current Assets 403m
Current Liabilities 1.8B
Accounts Payable 1B
Short-Term Debt 328m
Other Current Liabilities 425m
Non-Current Liabilities 3.6B
Long-Term Debt 3.3B
Other Non-Current Liabilities 285m
Efficiency

Earnings Waterfall
Smith & Nephew PLC

Revenue
5.6B USD
Cost of Revenue
-1.7B USD
Gross Profit
3.9B USD
Operating Expenses
-3.2B USD
Operating Income
696m USD
Other Expenses
-391m USD
Net Income
305m USD

Free Cash Flow Analysis
Smith & Nephew PLC

Last Value
3-Years Average
FCF Margin
Conversion Rate
Earnings Calls

Smith & Nephew concluded 2023 on a high note, surpassing its already raised revenue growth guidance, with Sports Medicine and ENT experiencing double-digit expansion and Advanced Wound Management sustaining momentum. While Orthopedics improvement is ongoing, their 12-Point Plan fosters advancement, as highlighted by accelerated growth across all business units and a solidified portfolio. The company met its 17.5% target margin, despite inflation and slow market activity in China, and achieved a 7.2% underlying revenue growth, totaling $5.5 billion. Reported growth was slightly lower at 6.4%, due to currency effects. Trading profit saw a 7.6% uptick to $970 million, and a notable $200 million betterment in working capital outflow brought trading cash flow to $635 million. Adjusted earnings per share increased modestly by 1.3% to $0.828. The dividend remained steady at $0.375 for the year. Entering 2024, Smith & Nephew anticipates further growth and margin improvement, even in light of the anticipated headwinds from China's Volume-Based Procurement (VBP).

What is Earnings Call?
Fundamental Scores

SN Profitability Score
Profitability Due Diligence

Smith & Nephew PLC's profitability score is 53/100. The higher the profitability score, the more profitable the company is.

Positive Gross Profit
Positive Free Cash Flow
Positive Revenue Growth Forecast
Positive Operating Income
53/100
Profitability
Score

Smith & Nephew PLC's profitability score is 53/100. The higher the profitability score, the more profitable the company is.

SN Solvency Score
Solvency Due Diligence

Smith & Nephew PLC's solvency score is 47/100. The higher the solvency score, the more solvent the company is.

Short-Term Solvency
Long-Term Solvency
Low D/E
Average Altman Z-Score
47/100
Solvency
Score

Smith & Nephew PLC's solvency score is 47/100. The higher the solvency score, the more solvent the company is.

Wall St
Price Targets

SN Price Targets Summary
Smith & Nephew PLC

Wall Street analysts forecast SN stock price to rise over the next 12 months.

According to Wall Street analysts, the average 1-year price target for SN is 1 259.7 GBX with a low forecast of 1 020.1 GBX and a high forecast of 1 543.5 GBX.

Lowest
Price Target
1 020.1 GBX
3% Upside
Average
Price Target
1 259.7 GBX
28% Upside
Highest
Price Target
1 543.5 GBX
56% Upside
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Dividends

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Shareholder Yield

Current shareholder yield for SN is .

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Smith & Nephew PLC Logo
Smith & Nephew PLC

Country

United Kingdom

Industry

Health Care

Market Cap

8.6B GBP

Dividend Yield

3.8%

Description

Smith & Nephew PLC engages in the development, manufacture, marketing, and sale of medical devices. The company is headquartered in Watford, Hertfordshire and currently employs 18,369 full-time employees. The firm is engaged in designing and manufacturing technology. The company supports healthcare professionals to return their patients to health and mobility by helping them to perform. The company serves its customers through global franchises, which includes Orthopaedics, Sports Medicine and Ear, Nose and Throat (ENT) and Advanced Wound Management. The Orthopaedics includes a range of Hip and Knee Implants used to replace diseased, damaged or worn joints, robotics-assisted enabling technologies that allow surgeons, and Trauma products used to stabilize severe fractures and correct bone deformities. Its Sports Medicine and ENT businesses offer advanced products and instruments used to repair or remove soft tissue. Its Advanced Wound Management portfolio provides a set of products to meet clinical needs, to help healthcare professionals reduce the human and economic consequences of wounds.

Contact

HERTFORDSHIRE
Watford
Building 5, Croxley Park, Hatters Lane
+4401923477100.0
www.smith-nephew.com

IPO

1951-08-13

Employees

18 369

Officers

CEO & Director
Dr. Deepak S. Nath Ph.D.
CFO & Executive Director
Mr. John Terence Rogers
President of Global Operations
Mr. Paul Connolly
Vice President of Investor Relations
Mr. Andrew Swift
Group General Counsel & Company Secretary
Ms. Helen Barraclough
Chief Compliance Officer & Compliance APAC
Ms. Alison Parkes
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Senior Vice President of Marketing Services & Communications
Mr. Joe Metzger
Chief Corporate Development & Corporate Affairs Officer
Mr. Philip G. Cowdy
Chief Human Resources Officer
Ms. Elga Lohler
President of Research & Development and Ear, Nose & Throat
Dr. Vasant Padmanabhan Ph.D.
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See Also

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What is the Intrinsic Value of one SN stock?

The intrinsic value of one SN stock under the Base Case scenario is 1 458.57 GBX.

Is SN stock undervalued or overvalued?

Compared to the current market price of 986.8 GBX, Smith & Nephew PLC is Undervalued by 32%.

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