STE  Steris Corporation

Exchange

NYSE

Sector

Health Care

Industry

Industrial Specialties

Market Cap.

6.56B

Vuru Grade

33.63/100

Current Price

$77.10
-0.27 (-0.35%)

Growth Price

$58.01
Overvalued by 24.75%

Stability Price

$6.25
Overvalued by 91.89%

Company Metrics

  • P/E 60.23
  • P/S 2.52
  • P/B 2.35
  • EPS 1.28
  • Cash ROIC 7.35%
  • Cash Ratio 0.74
  • Dividend 1.12 / 1.45%
  • Avg. Vol. 443,027.00
  • Shares 85.08M
  • Market Cap. 6.56B

Company Description

STERIS Corporation develops, manufactures, and markets infection prevention, contamination control, microbial reduction, and surgical support products and services to healthcare, pharmaceutical, scientific, research, industrial, and governmental customers worldwide. It offers sterilizers, including low temperature liquid, vaporized hydrogen peroxide, and ethylene oxide technologies, as well as ste... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

STERIS Plc (STE) Q4 2017 Results - Earnings Call Transcript
Seeking Alpha - May 9, 2017
Good day, everyone, and welcome to the STERIS Plc Fourth Quarter and Year End Conference Call. All participants will be in a listen-only mode.
STERIS Plc (STE) Q3 2017 Results - Earnings Call Transcript
Seeking Alpha - Feb 7, 2017
Many important factors could cause actual results to differ materially from those in the forward-looking statements, including without limitation those risk factors described in STERIS plc's, STERIS Corporation's, and Synergy's previous securities ...
STERIS PLC (STE) Files –…-K for the Fiscal Year Ended on March '–, —…–7
GuruFocus.com - May 26, 2017
STERIS PLC (NYSE:STE) files its latest 10-K with SEC for the fiscal year ended on March 31, 2017. STERIS PLC is a provider of infection prevention and other procedural products and services, focused on healthcare, pharmaceutical and research.
Steris PLC (STE) Issues Earnings Results, Beats Expectations By $0.04 EPS - Sports Perspectives
Michael J. Tokich Sells 2000 Shares of Steris PLC (STE) Stock - The Cerbat Gem
STERIS Plc (STE) Q2 2017 Results - Earnings Call Transcript
Seeking Alpha - Nov 2, 2016
Many important factors could cause actual results to differ materially from those in the forward-looking statements, including without limitation, those risk factors described in STERIS Plc's, STERIS Corporation's and Synergy's previous securities ...
Steris Plc (STE): Poised for Long-Term Success?
Simply Wall St - May 24, 2017
How is Steris Plc (NYSE:STE) going to perform in the future? What are the important facts you need to know? I'm going to investigate the latest data and look into some metrics you shouldn't overlook.
ProShare Advisors LLC Lowers Position in Steris PLC (STE) - BNB Daily (blog)
Trading Options During Earnings in STERIS PLC
CML News - May 25, 2017
We're going to examine buying and selling out of the money strangles in STERIS PLC and find out once and for all what the winning trades have been during earnings releases.
Right After Earnings, The Intelligent Options Trade in Steris Plc (NYSE:STE)
CML News - May 10, 2017
For Steris Plc, irrespective of whether the earnings move was up or down, if we waited two-days after the stock move, and then sold a one-month out of the money put spread, the results were simply staggering.
STERIS (STE) Tops Q4 Earnings & Revenues, Issues '18 View - Zacks.com
Can Steris Plc's (STE) Financial Condition Cause Increased Volatility? - Simply Wall St
Risk Malaise Alert in Option Market: Steris Plc Implied Price Swing Hits A ...
CML News - May 21, 2017
Before we dive into any analysis we simply note that Steris Plc (NYSE:STE) risk is actually priced pretty low by the option market as of right now.
Bargain or Bust? What's inside the Numbers For Steris Plc (NYSE:STE)
Clayton News - 14 hours ago
Steris Plc (NYSE:STE) presently has a current ratio of 2.67. The current ratio, also known as the working capital ratio, is a liquidity ratio that displays the proportion of current assets of a business relative to the current liabilities.
Why Investors remained buoyant on: BioPharmX Corporation (BPMX), Steris Plc (STE)
StockNewsJournal - May 4, 2017
BioPharmX Corporation (NYSE:BPMX) market capitalization at present is $58.56M at the rate of $0.85 a share. The firm's price-to-sales ratio was noted 568.84 in contrast with an overall industry average of 170.97.
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for STE to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate STE's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$77.10 Current Price

$58.01 Growth Price (DCF)

Overvalued by 24.75%


Growth Rate Assumed by Market: 20.74%


Future Free Cash Flow Growth Rate: 7.0%


Discount Rate: 15.0%


Show Free Cash Flow numbers

$6.25 Stability Price (EPV)

Overvalued by 91.89%


Discount Rate: 15.0%

$84.98 Book Price

Undervalued by 10.22%


Poor Cash Return on Invested Capital over the past 5 years

STE has been unable to consistently generate sufficient returns from its investments in buildings, projects and equipment. This could be due to poor management, lack of an economic moat or the capital intensive nature of the business.

STE has only created $7.35 of cash for every $100 invested.
Figures in USD. Fiscal year ends in March
20132014201520162017
Free Cash Flow 140.40M 123.26M 160.79M 128.27M 251.19M
divided by
Invested Capital 1.40B 1.48B 1.65B 4.70B 4.26B
Cash ROIC 10.03% 8.33% 9.75% 2.73% 5.90%

Poor Return on Equity over the past 5 years

STE has shown an inability to deliver strong results for shareholders. This could be due to poor management, STE operating in a highly competitive industry, or having a weak business in general.

STE has only generated $9.93 of Earnings for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in March
20132014201520162017
Net Income 159.98M 129.44M 135.06M 111.59M 110.63M
divided by
Stockholders' Equity 944.94M 1.04B 1.07B 3.02B 2.80B
Return on Equity 16.93% 12.46% 12.60% 3.69% 3.95%

Excellent Business Performance over the past 10 years

STE has been able to maintain profitability in good times and bad. This could mean STE has an extremely strong business or has the ability to scale down costs when needed. This should be a fairly resilient business, but double check for future sustainability by looking at its Risk Factors in the Annual Report.

STE has created positive free cash flow for 9 or more of the past 10 years.
Figures in USD. Fiscal year ends in March
2008200920102011201220132014201520162017
Free Cash Flow 86.43M 126.50M 180.87M 40.30M 82.69M 140.40M 123.26M 160.79M 128.27M 251.19M

Good Balance Sheet

STE's Total Assets double Total Liabilities. Its financial position is adequate. Remember to check Shareholders' Equity to see if it's stable or growing. It's one of the best measures of whether a company is creating value for shareholders.
Figures in USD. Fiscal year ends in March
2008200920102011201220132014201520162017
Cash 51.87M 154.18M 214.97M 193.02M 150.82M 142.01M 152.80M 167.69M 248.84M 282.92M
Current Assets 513.38M 553.13M 576.46M 705.81M 651.88M 613.94M 674.75M 720.43M 972.53M 1.02B
Total Assets 1.24B 1.22B 1.24B 1.43B 1.41B 1.76B 1.89B 2.10B 5.35B 4.92B
Current Liabilities 230.36M 202.03M 197.13M 344.75M 278.40M 218.84M 254.51M 283.33M 400.61M 381.58M
Total Liabilities 533.14M 499.20M 484.69M 639.12M 584.30M 816.17M 848.46M 1.03B 2.32B 2.13B
Stockholder' Equity 706.15M 717.74M 753.71M 787.57M 821.40M 944.94M 1.04B 1.07B 3.02B 2.80B
Current Ratio 2.23 2.74 2.92 2.05 2.34 2.81 2.65 2.54 2.43 2.67
TL-to-TA 0.43 0.41 0.39 0.45 0.42 0.46 0.45 0.49 0.43 0.43

Low or No Reinvestment of Profits over the past 10 years

STE has either been retaining a small amount of their earnings or has done so inconsistently. A lack of consistency could be due to STE operating at a loss or them having such a strong economic moat they feel comfortable spending profits on growth. Be wary of future prospects and if applicable, inspect the moat's sustainability.
Figures in USD. Fiscal year ends in March
2008200920102011201220132014201520162017
Retained Earnings 721.33M 814.36M 798.81M 816.85M 914.40M 1.03B 1.11B 1.19B 939.46M 954.16M
Retained Earnings Growth - 12.90% -1.91% 2.26% 11.94% 12.77% 7.86% 7.33% -21.30% 1.56%

Competitive Industry over the past 10 years

STE is likely operating in an industry with medium to low barriers to entry. This may mean that STE doesn't have a characteristic that's hard to replicate, such as exclusive distribution, branding or the ability to keep costs low. If Gross Margins are at least satisfactory, it's likely that STE invests heavily in R&D and Sales, General & Administrative expenses.

Only $7.39 of every $100 of Revenue have been profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in March
2008200920102011201220132014201520162017
Net Income 77.11M 110.69M 128.47M 51.27M 136.12M 159.98M 129.44M 135.06M 111.59M 110.63M
divided by
Revenue 1.27B 1.30B 1.26B 1.21B 1.41B 1.50B 1.62B 1.85B 2.24B 2.61B
Net Profit Margin 6.09% 8.52% 10.21% 4.25% 9.68% 10.65% 7.98% 7.30% 4.98% 4.23%

Varying Pricing Power over the past 10 years

STE has maintained substantial gross margins, suggesting that they have been able to set prices without consideration of the cost of goods sold. However, there is a substantial variation in their Gross Profit Margins from year-to-year, which indicates inconsistent performance. Look at reasons for this inconsistency to determine the likelihood of future sustainability.

$46.18 of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in March
2008200920102011201220132014201520162017
Gross Profit 523.96M 526.74M 539.18M 446.16M 1.37B 621.26M 649.62M 774.30M 895.48M 1.03B
divided by
Revenue 1.27B 1.30B 1.26B 1.21B 1.41B 1.50B 1.62B 1.85B 2.24B 2.61B
Gross Margin 41.42% 40.56% 42.87% 36.95% 97.44% 41.37% 40.04% 41.85% 40.00% 39.25%

High Capital Intensity over the past 10 years

STE spends large amounts of capital buying new equipment or investing in new facilities to stay competitive. Over the long term, those costs may have to be fuelled by debt. Look at the growth of Shareholders' Equity to see if this strategy is having a positive or negative impact.

79.93% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in March
2008200920102011201220132014201520162017
Capital Expenditure 56.97M 40.89M 44.09M 77.44M 66.68M 87.41M 86.37M 85.26M 126.41M 172.90M
divided by
Net Income 77.11M 110.69M 128.47M 51.27M 136.12M 159.98M 129.44M 135.06M 111.59M 110.63M
Capital Expenditure Ratio 73.89% 36.94% 34.32% 151.06% 48.99% 54.64% 66.72% 63.12% 113.28% 156.29%

Very Strong Dividend History over the past 10 years

STE has consistently distributed a dividend for at least the past 10 years. Such a long dividend history suggests STE is very established in its market and that its dividend distribution is likely to continue for a significant period of time.
Figures in USD. Fiscal year ends in March
2008200920102011201220132014201520162017
Dividend Paid 14.61M 17.66M 144.02M 33.23M 38.56M 43.20M 48.39M 53.51M 65.20M 93.19M
divided by
Shares Outstanding 64.26M 59.54M 59.42M 60.15M 58.96M 58.84M 59.75M 60.05M 71.18M 86.09M
Dividend Paid Per Share 0.23 0.30 2.42 0.55 0.65 0.73 0.81 0.89 0.92 1.08
Price at Year End 20.61 27.27 36.06 29.66 34.64 48.01 65.84 76.95 67.39 75.00
Dividend Yield 1.10% 1.09% 6.72% 1.86% 1.89% 1.53% 1.23% 1.16% 1.36% 1.44%

History of Stock Buybacks over the past 10 years

STE has some history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in March
2008200920102011201220132014201520162017
Shares Outstanding 64.26M 59.54M 59.42M 60.15M 58.96M 58.84M 59.75M 60.05M 71.18M 86.09M
Stock Bought Back - 7.91% 0.20% -1.21% 2.01% 0.20% -1.51% -0.50% -15.65% -17.32%
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