STE  Steris Corporation

Exchange

NYSE

Sector

Health Care

Industry

Industrial Specialties

Market Cap.

5.89B

Vuru Grade

38.74/100

Current Price

$69.38
-0.43 (-0.62%)

Growth Price

$59.57
Overvalued by 14.14%

Stability Price

$28.21
Overvalued by 59.34%

Company Metrics

  • P/E 42.20
  • P/S 2.27
  • P/B 2.15
  • EPS 1.64
  • Cash ROIC 7.86%
  • Cash Ratio 0.62
  • Dividend 1.12 / 1.63 %
  • Avg. Vol. 562,943.00
  • Shares 71.18M
  • Market Cap. 5.89B

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 to Participate in the Raymond James Institutional Investor ...
Yahoo Finance - Feb 21, 2017
... those in the forward-looking statements include, without limitation, (a) STERIS`s ability to meet expectations regarding the accounting and tax treatments of the Combination (the "Combination") with STERIS Corporation and Synergy Health plc ...
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 ...
Forward Earnings Estimate of STERIS PLC(STE) - Highland Mirror
Steris Plc (STE): Is it a good long term opportunity? - Simply Wall St
Ex-Dividend Reminder: Steris, RLI Corp. and EPR Properties
Nasdaq - 13 hours ago
Looking at the universe of stocks we cover at Dividend Channel , on 2/24/17, Steris plc (Symbol: STE), RLI Corp. (Symbol: RLI), and EPR Properties (Symbol: EPR) will all trade ex-dividend for their respective upcoming dividends.
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 Announces Financial Results for Fiscal 2017 Third Quarter
Yahoo Finance - Feb 7, 2017
LEICESTER, U.K. - (February 7, 2017) - STERIS plc (STE) ("STERIS" or the "Company") today announced financial results for its fiscal 2017 third quarter ended December 31, 2016.
The Nicholas Co. Inc. WI Increases Stake in Steris Plc (STE)
DailyQuint - 6 hours ago
Nicholas Co. Inc. WI increased its stake in shares of Steris Plc (NYSE:STE) by 0.9% during the fourth quarter, according to its most recent filing with the SEC.
Large Outflow of Money Witnessed in STERIS plc - Money Flow Index & Trends
Brown Advisory Inc. Acquires Shares of 30275 Steris PLC (STE) - The Cerbat Gem
STERIS plc (STE) Ex-Dividend Date Scheduled for November 21, 2016
Nasdaq - Nov 18, 2016
STERIS plc ( STE ) will begin trading ex-dividend on November 21, 2016. A cash dividend payment of $0.28 per share is scheduled to be paid on December 21, 2016.
North America Sterilization Technologies Market, 2016-2022 with 3M Company ...
Business Wire (press release) - Feb 21, 2017
Sterilization Technologies are the processes used to reduce the growth of all viable life forms such as bacteria, viruses, fungi, and spore forms from the surfaces of equipment, pharmaceuticals, medications, food ingredients, and biological culture medium.
Steris Corp. completes $1.9 billion acquisition of Synergy Health
Crain's Cleveland Business - Nov 2, 2015
It wasn't easy, but Steris Corp. of Mentor finally has completed its $1.9 billion acquisition of Synergy Health plc. The company on Monday, Nov. 2, announced the deal - originally announced in October 2014, then hung up by regulatory concerns - is done.
Revenue Approximations Analysis: Steris Plc (STE), PTC Inc. (PTC)
StockNewsJournal - Feb 10, 2017
Steris Plc (STE) have shown a high EPS growth of 12.80% in the last 5 years and has earnings decline of -30.80% yoy. Analysts have a mean recommendation of 1.90 on this stock (A rating of less than 2 means buy, “hold” within the 3 range, “sell” within ...
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.

$69.38 Current Price

$59.57 Growth Price (DCF)

Overvalued by 14.14%


Growth Rate Assumed by Market: 20.68%


Future Free Cash Flow Growth Rate: 9.7%


Discount Rate: 15.0%


Show Free Cash Flow numbers

$28.21 Stability Price (EPV)

Overvalued by 59.34%


Discount Rate: 15.0%

$109.29 Book Price

Undervalued by 57.52%


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 $7.86 of cash for every $100 invested.
Figures in USD. Fiscal year ends in March
20122013201420152016
Free Cash Flow 82.69M 140.40M 123.26M 160.79M 128.27M
divided by
Invested Capital 976.48M 1.40B 1.48B 1.65B 4.70B
Cash ROIC 8.47% 10.03% 8.33% 9.75% 2.73%

Shrinking Return on Equity over the past 5 years

STE has been shrinking returns with capital that shareholders have invested. This is a negative sign and demonstrates that both the business and management performance are weakening over time.

STE has generated $12.45 of Earnings for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in March
20122013201420152016
Net Income 136.12M 159.98M 129.44M 135.06M 111.59M
divided by
Stockholders' Equity 821.40M 944.94M 1.04B 1.07B 3.02B
Return on Equity 16.57% 16.93% 12.46% 12.60% 3.69%

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
2007200820092010201120122013201420152016
Free Cash Flow 46.72M 86.43M 126.50M 180.87M 40.30M 82.69M 140.40M 123.26M 160.79M 128.27M

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
2007200820092010201120122013201420152016
Cash 52.30M 51.87M 154.18M 214.97M 193.02M 150.82M 142.01M 152.80M 167.69M 248.84M
Current Assets 484.72M 513.38M 553.13M 576.46M 705.81M 651.88M 613.94M 674.75M 720.43M 972.53M
Total Assets 1.21B 1.24B 1.22B 1.24B 1.43B 1.41B 1.76B 1.89B 2.10B 5.35B
Current Liabilities 217.40M 230.36M 202.03M 197.13M 344.75M 278.40M 218.84M 254.51M 283.33M 400.61M
Total Liabilities 434.88M 533.14M 499.20M 484.69M 639.12M 584.30M 816.17M 848.46M 1.03B 2.32B
Stockholder' Equity 774.29M 706.15M 717.74M 753.71M 787.57M 821.40M 944.94M 1.04B 1.07B 3.02B
Current Ratio 2.23 2.23 2.74 2.92 2.05 2.34 2.81 2.65 2.54 2.43
TL-to-TA 0.36 0.43 0.41 0.39 0.45 0.42 0.46 0.45 0.49 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
2007200820092010201120122013201420152016
Retained Earnings 667.27M 721.33M 814.36M 798.81M 816.85M 914.40M 1.03B 1.11B 1.19B 939.46M
Retained Earnings Growth - 8.10% 12.90% -1.91% 2.26% 11.94% 12.77% 7.86% 7.33% -21.30%

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 $7.65 of every $100 of Revenue have been profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in March
2007200820092010201120122013201420152016
Net Income 82.16M 77.11M 110.69M 128.47M 51.27M 136.12M 159.98M 129.44M 135.06M 111.59M
divided by
Revenue 1.20B 1.27B 1.30B 1.26B 1.21B 1.41B 1.50B 1.62B 1.85B 2.24B
Net Profit Margin 6.86% 6.09% 8.52% 10.21% 4.25% 9.68% 10.65% 7.98% 7.30% 4.98%

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.

$46.47 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
2007200820092010201120122013201420152016
Gross Profit 504.81M 523.96M 526.74M 539.18M 446.16M 1.37B 621.26M 649.62M 774.30M 895.48M
divided by
Revenue 1.20B 1.27B 1.30B 1.26B 1.21B 1.41B 1.50B 1.62B 1.85B 2.24B
Gross Margin 42.16% 41.42% 40.56% 42.87% 36.95% 97.44% 41.37% 40.04% 41.85% 40.00%

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.

70.26% 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
2007200820092010201120122013201420152016
Capital Expenditure 49.02M 56.97M 40.89M 44.09M 77.44M 66.68M 87.41M 86.37M 85.26M 126.41M
divided by
Net Income 82.16M 77.11M 110.69M 128.47M 51.27M 136.12M 159.98M 129.44M 135.06M 111.59M
Capital Expenditure Ratio 59.67% 73.89% 36.94% 34.32% 151.06% 48.99% 54.64% 66.72% 63.12% 113.28%

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
2007200820092010201120122013201420152016
Dividend Paid 11.77M 14.61M 17.66M 144.02M 33.23M 38.56M 43.20M 48.39M 53.51M 65.20M
divided by
Shares Outstanding 65.72M 64.26M 59.54M 59.42M 60.15M 58.96M 58.84M 59.75M 60.05M 71.18M
Dividend Paid Per Share 0.18 0.23 0.30 2.42 0.55 0.65 0.73 0.81 0.89 0.92
Price at Year End 25.93 20.61 27.27 36.06 29.66 34.64 48.01 65.84 76.95 67.39
Dividend Yield 0.69% 1.10% 1.09% 6.72% 1.86% 1.89% 1.53% 1.23% 1.16% 1.36%

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
2007200820092010201120122013201420152016
Shares Outstanding 65.72M 64.26M 59.54M 59.42M 60.15M 58.96M 58.84M 59.75M 60.05M 71.18M
Stock Bought Back - 2.29% 7.91% 0.20% -1.21% 2.01% 0.20% -1.51% -0.50% -15.65%
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