Fact based stock research
Smith & Nephew (LSE:SN.)
GB0009223206
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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Smith & Nephew stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 65 (better than 65% compared with investment alternatives), Smith & Nephew (Health Care Equipment, United Kingdom) shares have above-average financial characteristics compared with similar stocks. Shares of Smith & Nephew are a good value (attractively priced) with a consolidated Value Rank of 89 (better than 89% of alternatives), are safely financed (Safety Rank of 63, which means low debt burdens), but show below-average growth (Growth Rank of 13). ...read more
RECOMMENDATION: A Combined Rank of 65, is a buy recommendation based on Smith & Nephew's financial characteristics. As the company Smith & Nephew's key financial metrics exhibit good value (Obermatt Value Rank of 89) but low growth (Obermatt Growth Rank of 13) while being safely financed (Obermatt Safety Rank of 63), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 89% of comparable companies, may also indicate that the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity and the downside is limited due to below-average financing risks. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
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360° Viewnew| Country | United Kingdom |
| Industry | Health Care Equipment |
| Index | FTSE All Shares, FTSE 100, FTSE 350, Dividends Europe, Robotics |
| Size class | X-Large |
This stock has achievements: Gold Winner CEO, Insight 2016-04-01, Top 10 Stock.
25-Apr-2024. Stock data may be delayed. Log in or sign up to get the most recent research.
Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.
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Review the performance ranks of the individual metrics that form each investment strategy.
Research History: Smith & Nephew
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 84 |
|
95 |
|
89 |
|
89 |
|
| GROWTH | ||||||||
| GROWTH | 53 |
|
23 |
|
47 |
|
13 |
|
| SAFETY | ||||||||
| SAFETY | 64 |
|
34 |
|
54 |
|
63 |
|
| SENTIMENT | ||||||||
| SENTIMENT | n/a |
|
7 |
|
61 |
|
new |
|
| 360° VIEW | ||||||||
| 360° VIEW | n/a |
|
23 |
|
76 |
|
new |
|
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 65 (better than 65% compared with investment alternatives), Smith & Nephew (Health Care Equipment, United Kingdom) shares have above-average financial characteristics compared with similar stocks. Shares of Smith & Nephew are a good value (attractively priced) with a consolidated Value Rank of 89 (better than 89% of alternatives), are safely financed (Safety Rank of 63, which means low debt burdens), but show below-average growth (Growth Rank of 13). ...read more
RECOMMENDATION: A Combined Rank of 65, is a buy recommendation based on Smith & Nephew's financial characteristics. As the company Smith & Nephew's key financial metrics exhibit good value (Obermatt Value Rank of 89) but low growth (Obermatt Growth Rank of 13) while being safely financed (Obermatt Safety Rank of 63), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 89% of comparable companies, may also indicate that the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity and the downside is limited due to below-average financing risks. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 84 |
|
95 |
|
89 |
|
89 |
|
| GROWTH | ||||||||
| GROWTH | 53 |
|
23 |
|
47 |
|
13 |
|
| SAFETY | ||||||||
| SAFETY | 64 |
|
34 |
|
54 |
|
63 |
|
| COMBINED | ||||||||
| COMBINED | 77 |
|
53 |
|
88 |
|
65 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 89 (better than 89% compared with alternatives) for 2024, Smith & Nephew shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Smith & Nephew. Price-to-Sales is 62 which means that the stock price compared with what market professionals expect for future sales is lower than for 62% of comparable companies, indicating a good value for Smith & Nephew's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 88% of alternatives, and this is also true for the Price-to-Book capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 71. Compared with other companies in the same industry, dividend yields of Smith & Nephew are expected to be higher than for 88% of all competitors (a Dividend Yield rank of 88). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 89, is a buy recommendation based on Smith & Nephew's stock price compared with the company's operational size and dividend yields. Since all value metrics are above the industry average, there is no objection to investing in Smith & Nephew based on its detailed value metrics. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision. ...read more
| VALUE METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| PRICE VS. REVENUES (P/S) | ||||||||
| PRICE VS. REVENUES (P/S) | 68 |
|
68 |
|
62 |
|
62 |
|
| PRICE VS. PROFITS (P/E) | ||||||||
| PRICE VS. PROFITS (P/E) | 80 |
|
84 |
|
84 |
|
88 |
|
| PRICE VS. CAPITAL (Market-to-Book) | ||||||||
| PRICE VS. CAPITAL (Market-to-Book) | 62 |
|
74 |
|
66 |
|
71 |
|
| DIVIDEND YIELD | ||||||||
| DIVIDEND YIELD | 62 |
|
80 |
|
84 |
|
88 |
|
| CONSOLIDATED RANK: VALUE | ||||||||
| CONSOLIDATED RANK: VALUE | 84 |
|
95 |
|
89 |
|
89 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 13 (better than 13% compared with alternatives), Smith & Nephew shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below average for Smith & Nephew. Only Capital Growth has a good rank of 55, which means that currently professionals expect the company to grow its invested capital more than 22% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 22 which means that currently professionals expect the company to grow less than 78% of its competitors. Profit Growth with a rank of 22 and Stock Returns with a rank of 25 are also low (below 75% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 13, is a sell recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for Smith & Nephew is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is limited here. ...read more
| GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 48 |
|
33 |
|
24 |
|
22 |
|
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 42 |
|
35 |
|
42 |
|
22 |
|
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | n/a |
|
67 |
|
76 |
|
55 |
|
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 28 |
|
9 |
|
45 |
|
25 |
|
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 53 |
|
23 |
|
47 |
|
13 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 63 (better than 63% compared with alternatives), the company Smith & Nephew has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Smith & Nephew is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above-average for Smith & Nephew. Refinancing is at 65, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 65% of its competitors. Liquidity is also good at 52, meaning the company generates more profit to service its debt than 52% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 41, which means the company has an above-average debt-to-equity ratio. It has more debt than 59% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 63 (better than 63% compared with alternatives), Smith & Nephew has a financing structure that is safer than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and Smith & Nephew could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. In the long-term, investors may have a debt challenge with Smith & Nephew and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more
| SAFETY METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 35 |
|
26 |
|
38 |
|
41 |
|
| REFINANCING | ||||||||
| REFINANCING | 81 |
|
65 |
|
71 |
|
65 |
|
| LIQUIDITY | ||||||||
| LIQUIDITY | 55 |
|
39 |
|
43 |
|
52 |
|
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 64 |
|
34 |
|
54 |
|
63 |
|
Sentiment Metrics in Detail
| SENTIMENT | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| ANALYST OPINIONS | ||||||||
| ANALYST OPINIONS | n/a |
|
29 |
|
62 |
|
new |
|
| OPINIONS CHANGE | ||||||||
| OPINIONS CHANGE | n/a |
|
50 |
|
46 |
|
new |
|
| PRO HOLDINGS | ||||||||
| PRO HOLDINGS | n/a |
|
30 |
|
66 |
|
new |
|
| MARKET PULSE | ||||||||
| MARKET PULSE | n/a |
|
30 |
|
40 |
|
new |
|
| CONSOLIDATED RANK: SENTIMENT | ||||||||
| CONSOLIDATED RANK: SENTIMENT | n/a |
|
7 |
|
61 |
|
new |
|
Stock analysis by the purely fact based Obermatt Method for Smith & Nephew from April 25, 2024.
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