LSE:SN.

Stock Analysis Report

Executive Summary

Smith & Nephew plc develops, manufactures, and sells medical devices worldwide.

Snowflake

Fundamentals

Excellent balance sheet average dividend payer.


Similar Companies

Share Price & News

How has Smith & Nephew's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

1.9%

LSE:SN.

1.1%

GB Medical Equipment

0.4%

GB Market


1 Year Return

40.8%

LSE:SN.

20.2%

GB Medical Equipment

-6.2%

GB Market

SN. outperformed the Medical Equipment industry which returned 20.2% over the past year.

SN. outperformed the Market in United Kingdom of Great Britain and Northern Ireland which returned -6.2% over the past year.


Share holder returns

SN.IndustryMarket
7 Day1.9%1.1%0.4%
30 Day7.6%8.1%-5.2%
90 Day16.8%14.7%-2.3%
1 Year43.5%40.8%22.7%20.2%-1.7%-6.2%
3 Year67.3%57.9%59.9%51.5%16.8%2.9%
5 Year103.5%85.3%89.0%72.5%24.2%-2.3%

Price Volatility Vs. Market

How volatile is Smith & Nephew's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Smith & Nephew undervalued based on future cash flows and its price relative to the stock market?

20%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

Smith & Nephew's share price is below the future cash flow value, and at a moderate discount (> 20%).

Smith & Nephew's share price is below the future cash flow value, but not at a substantial discount (< 40%).


Price Based on Earnings

Smith & Nephew is overvalued based on earnings compared to the GB Medical Equipment industry average.

Smith & Nephew is overvalued based on earnings compared to the United Kingdom of Great Britain and Northern Ireland market.


Price Based on Expected Growth

Smith & Nephew is poor value based on expected growth next year.


Price Based on Value of Assets

Smith & Nephew is overvalued based on assets compared to the GB Medical Equipment industry average.


Next Steps

Future Growth

How is Smith & Nephew expected to perform in the next 1 to 3 years based on estimates from 17 analysts?

12.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Smith & Nephew's revenue is expected to grow by 4.4% yearly, however this is not considered high growth (20% yearly).

Smith & Nephew's earnings are expected to grow by 12.2% yearly, however this is not considered high growth (20% yearly).

Smith & Nephew's revenue growth is expected to exceed the United Kingdom of Great Britain and Northern Ireland market average.

Smith & Nephew's earnings growth is positive but not above the United Kingdom of Great Britain and Northern Ireland market average.

Smith & Nephew's earnings growth is expected to exceed the low risk savings rate of 1.2%.


Earnings per Share Growth Estimates


Future Return on Equity

Smith & Nephew is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).


Next Steps

Past Performance

How has Smith & Nephew performed over the past 5 years?

10.1%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Smith & Nephew's year on year earnings growth rate has been positive over the past 5 years.

Smith & Nephew's 1-year earnings growth is negative, it can't be compared to the 5-year average.

Smith & Nephew's 1-year earnings growth is negative, it can't be compared to the GB Medical Equipment industry average.


Return on Equity

Smith & Nephew has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).


Return on Assets

Smith & Nephew used its assets less efficiently than the GB Medical Equipment industry average last year based on Return on Assets.


Return on Capital Employed

Smith & Nephew's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).


Next Steps

Financial Health

How is Smith & Nephew's financial position?


Financial Position Analysis

Smith & Nephew is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

Smith & Nephew's cash and other short term assets cover its long term commitments.


Debt to Equity History and Analysis

Smith & Nephew's level of debt (40.7%) compared to net worth is high (greater than 40%).

The level of debt compared to net worth has been reduced over the past 5 years (49.1% vs 40.7% today).

Debt is well covered by operating cash flow (53.8%, greater than 20% of total debt).

Interest payments on debt are well covered by earnings (EBIT is 19.9x coverage).


Balance Sheet

High level of physical assets or inventory.

Debt is covered by short term assets, assets are 1.5x debt.


Next Steps

Dividend

What is Smith & Nephew's current dividend yield, its reliability and sustainability?

1.73%

Expected Dividend Yield


Upcoming Dividend Payment

Purchase Smith & Nephew before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield and Payments Analysis

Smith & Nephew's pays a lower dividend yield than the bottom 25% of dividend payers in United Kingdom of Great Britain and Northern Ireland (2.05%).

Smith & Nephew's dividend is below the markets top 25% of dividend payers in United Kingdom of Great Britain and Northern Ireland (5.65%).

Dividends per share have been stable in the past 10 years.

Dividends per share have increased over the past 10 years.


Current Payout to Shareholders

Dividends paid are well covered by earnings (2.2x coverage).


Future Payout to Shareholders

Dividends after 3 years are expected to be well covered by earnings (2.7x coverage).


Next Steps

Management

What is the CEO of Smith & Nephew's salary, the management and board of directors tenure and is there insider trading?

2.4yrs

Average management tenure


CEO

Namal Nawana (48yo)

1.3yrs

Tenure

US$3,431,398

Compensation

Mr. Namal Nawana has been Chief Executive Officer and Executive Director at Smith & Nephew plc since May 07, 2018. Mr. Nawana has been Director of Hologic, Inc. since January 11, 2018. Mr. Nawana served as ...


CEO Compensation Analysis

Namal's remuneration is about average for companies of similar size in United Kingdom of Great Britain and Northern Ireland.

Insufficient data for Namal to compare compensation growth.


Management Age and Tenure

2.4yrs

Average Tenure

51yo

Average Age

The tenure for the Smith & Nephew management team is about average.


Board Age and Tenure

2.1yrs

Average Tenure

60yo

Average Age

The average tenure for the Smith & Nephew board of directors is less than 3 years, this suggests a new board.


Insider Trading

More shares have been bought than sold by Smith & Nephew individual insiders in the past 3 months.


Recent Insider Transactions

BuyUS$3,89623 Aug 19
Virginia Hilda Brunette Bottomley
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares201
Max PriceUS$19.39
BuyUS$3,43123 Aug 19
Robin Freestone
EntityIndividual
Role
Lead Director
Senior Independent Non-Executive Director
Shares177
Max PriceUS$19.39
BuyUS$57,76723 Aug 19
Roberto Quarta
EntityIndividual
Role
Chairman of the Board
Chairman
Shares2,980
Max PriceUS$19.39
BuyUS$3,43123 Aug 19
Erik Engstrom
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares177
Max PriceUS$19.39
BuyUS$3,89623 Aug 19
Angie Risley
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares201
Max PriceUS$19.39
BuyUS$5,05923 Aug 19
Roland Diggelmann
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares261
Max PriceUS$19.39
BuyUS$39,83128 Jun 19
Angie Risley
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares2,380
Max PriceUS$16.74
SellUS$677,84716 Nov 18
Rodrigo Bianchi
EntityIndividual
Shares48,832
Max PriceUS$13.88
SellUS$1,507,94512 Nov 18
Rodrigo Bianchi
EntityIndividual
Shares108,226
Max PriceUS$13.93

Ownership Breakdown


Management Team

  • Joe Metzger

    Senior Vice President of Marketing Services & Communications

    • Tenure: 8.6yrs
  • Graham Baker (51yo)

    CFO & Executive Director

    • Tenure: 2.3yrs
    • Compensation: US$1.98m
  • Phil Cowdy (52yo)

    Executive VP of Business Development & Corporate Affairs

    • Tenure: 5.6yrs
  • Namal Nawana (48yo)

    CEO & Executive Director

    • Tenure: 1.3yrs
    • Compensation: US$3.43m
  • Mark Gladwell (44yo)

    President of Global Operations

    • Tenure: 1.6yrs
  • Vasant Padmanabhan (52yo)

    President of Research & Development

    • Tenure: 3.0yrs
  • Elga Lohler (51yo)

    Chief Human Resources Officer

    • Tenure: 3.7yrs
  • Brad Cannon (51yo)

    President of Sports Medicine & ENT

    • Tenure: 1.6yrs
  • Cathy O'Rourke (46yo)

    Chief Legal & Compliance Officer

    • Tenure: 2.3yrs
  • Steve Kane

    Head of Human Resources for the US

    • Tenure: 0.0yrs

Board Members

  • Roberto Quarta (70yo)

    Chairman

    • Tenure: 5.3yrs
    • Compensation: US$418.70k
  • Erik Engstrom (56yo)

    Independent Non-Executive Director

    • Tenure: 4.6yrs
    • Compensation: US$69.50k
  • Virginia Hilda Brunette Bottomley (71yo)

    Independent Non-Executive Director

    • Tenure: 7.3yrs
    • Compensation: US$69.50k
  • Marc Owen (60yo)

    Independent Non-Executive Director

    • Tenure: 1.8yrs
    • Compensation: US$171.78k
  • Angie Risley (61yo)

    Independent Non-Executive Director

    • Tenure: 1.7yrs
    • Compensation: US$83.67k
  • Vinita Bali (64yo)

    Independent Non-Executive Director

    • Tenure: 4.7yrs
    • Compensation: US$171.78k
  • Robin Freestone (60yo)

    Senior Independent Non-Executive Director

    • Tenure: 0.3yrs
    • Compensation: US$89.50k
  • Graham Baker (51yo)

    CFO & Executive Director

    • Tenure: 2.3yrs
    • Compensation: US$1.98m
  • Roland Diggelmann (52yo)

    Independent Non-Executive Director

    • Tenure: 1.4yrs
    • Compensation: US$59.00k
  • Namal Nawana (48yo)

    CEO & Executive Director

    • Tenure: 1.3yrs
    • Compensation: US$3.43m

Company Information

Smith & Nephew plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Smith & Nephew plc
  • Ticker: SN.
  • Exchange: LSE
  • Founded: 1856
  • Industry: Health Care Equipment
  • Sector: Healthcare
  • Market Cap: UK£16.872b
  • Shares outstanding: 872.84m
  • Website: https://www.smith-nephew.com

Number of Employees


Location

  • Smith & Nephew plc
  • Building 5
  • Croxley Park
  • Watford
  • Hertfordshire
  • WD18 8YE
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SNNU.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1980
NPW1DB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 1980
SN.LSE (London Stock Exchange)YesOrdinary SharesGBGBPJan 1980
SNLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPJan 1980
SNNNYSE (New York Stock Exchange)ADR EACH REPR 5 USD0.20USUSDNov 1999
NPWADB (Deutsche Boerse AG)ADR EACH REPR 5 USD0.20DEEURNov 1999

Biography

Smith & Nephew plc develops, manufactures, and sells medical devices worldwide. The company offers sports medicine joint repair products for surgeons, including an array of instruments, technologies, and i ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/08/25 20:37
End of Day Share Price2019/08/23 00:00
Earnings2019/06/29
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.