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Varian Medical Systems

Market Cap

US$16.1b

Last Updated

2021/04/15 22:32 UTC

Data Sources

Company Financials +

Executive Summary

Varian Medical Systems, Inc. designs, manufactures, sells, and services medical devices and software products for treating cancer and other medical conditions worldwide. More Details

Rewards

Earnings are forecast to grow 24.12% per year

Risk Analysis

No risks detected for VAR from our risk checks.


Snowflake Analysis

Flawless balance sheet with reasonable growth potential.


Similar Companies

Share Price & News

How has Varian Medical Systems's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: VAR is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 0% a week.

Volatility Over Time: VAR's weekly volatility (0%) has been stable over the past year.


Market Performance


7 Day Return

-0.08%

VAR

-2.5%

US Medical Equipment

-1.7%

US Market


1 Year Return

63.4%

VAR

34.4%

US Medical Equipment

50.8%

US Market

Return vs Industry: VAR exceeded the US Medical Equipment industry which returned 41.8% over the past year.

Return vs Market: VAR exceeded the US Market which returned 57.5% over the past year.


Shareholder returns

VARIndustryMarket
7 Day-0.08%-2.5%-1.7%
30 Day0.5%-3.2%-1.5%
90 Day0.9%-3.1%0.4%
1 Year63.4%63.4%35.4%34.4%53.3%50.8%
3 Year39.7%39.7%68.0%64.1%61.5%51.4%
5 Year134.7%108.3%151.3%133.0%125.8%100.7%

Long-Term Price Volatility Vs. Market

How volatile is Varian Medical Systems's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Varian Medical Systems undervalued compared to its fair value and its price relative to the market?

58.08x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: VAR ($177.07) is trading above our estimate of fair value ($145.36)

Significantly Below Fair Value: VAR is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: VAR is poor value based on its PE Ratio (58.1x) compared to the US Medical Equipment industry average (50.8x).

PE vs Market: VAR is poor value based on its PE Ratio (58.1x) compared to the US market (22.3x).


Price to Earnings Growth Ratio

PEG Ratio: VAR is poor value based on its PEG Ratio (2.4x)


Price to Book Ratio

PB vs Industry: VAR is overvalued based on its PB Ratio (7.3x) compared to the US Medical Equipment industry average (5.1x).


Future Growth

How is Varian Medical Systems forecast to perform in the next 1 to 3 years based on estimates from 8 analysts?

24.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: VAR's forecast earnings growth (24.1% per year) is above the savings rate (2%).

Earnings vs Market: VAR's earnings (24.1% per year) are forecast to grow faster than the US market (18.4% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: VAR's revenue (11.1% per year) is forecast to grow faster than the US market (9.4% per year).

High Growth Revenue: VAR's revenue (11.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: VAR's Return on Equity is forecast to be low in 3 years time (18.7%).


Past Performance

How has Varian Medical Systems performed over the past 5 years?

-2.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: VAR has high quality earnings.

Growing Profit Margin: VAR's current net profit margins (8.9%) are higher than last year (8.4%).


Past Earnings Growth Analysis

Earnings Trend: VAR's earnings have declined by 2.8% per year over the past 5 years.

Accelerating Growth: VAR's earnings growth over the past year (0.2%) exceeds its 5-year average (-2.8% per year).

Earnings vs Industry: VAR earnings growth over the past year (0.2%) underperformed the Medical Equipment industry 10.1%.


Return on Equity

High ROE: VAR's Return on Equity (12.3%) is considered low.


Financial Health

How is Varian Medical Systems's financial position?


Financial Position Analysis

Short Term Liabilities: VAR's short term assets ($2.6B) exceed its short term liabilities ($1.7B).

Long Term Liabilities: VAR's short term assets ($2.6B) exceed its long term liabilities ($533.4M).


Debt to Equity History and Analysis

Debt Level: VAR's debt to equity ratio (9.3%) is considered satisfactory.

Reducing Debt: VAR's debt to equity ratio has reduced from 44.4% to 9.3% over the past 5 years.

Debt Coverage: VAR's debt is well covered by operating cash flow (244.2%).

Interest Coverage: VAR's interest payments on its debt are well covered by EBIT (1062.5x coverage).


Balance Sheet


Dividend

What is Varian Medical Systems's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate VAR's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate VAR's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if VAR's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if VAR's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of VAR's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

1.4yrs

Average management tenure


CEO

Dow Wilson (61 yo)

8.58yrs

Tenure

US$9,802,973

Compensation

Mr. Dow R. Wilson has been the Chief Executive Officer of Varian Medical Systems, Inc. since September 29, 2012 and served as its President from September 29, 2012 to October 5, 2020. Mr. Wilson has been a...


CEO Compensation Analysis

Compensation vs Market: Dow's total compensation ($USD9.80M) is about average for companies of similar size in the US market ($USD11.02M).

Compensation vs Earnings: Dow's compensation has been consistent with company performance over the past year.


Leadership Team

Experienced Management: VAR's management team is not considered experienced ( 1.4 years average tenure), which suggests a new team.


Board Members

Experienced Board: VAR's board of directors are considered experienced (4.4 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Varian Medical Systems, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Varian Medical Systems, Inc.
  • Ticker: VAR
  • Exchange: NYSE
  • Founded: 1948
  • Industry: Health Care Equipment
  • Sector: Healthcare
  • Market Cap: US$16.118b
  • Shares outstanding: 91.84m
  • Website: https://www.varian.com

Number of Employees


Location

  • Varian Medical Systems, Inc.
  • 3100 Hansen Way
  • Palo Alto
  • California
  • 94304-1038
  • United States

Listings


Biography

Varian Medical Systems, Inc. designs, manufactures, sells, and services medical devices and software products for treating cancer and other medical conditions worldwide. It operates through Oncology System...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/04/15 22:32
End of Day Share Price2021/04/14 00:00
Earnings2021/01/01
Annual Earnings2020/10/02


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.