Varian Medical Systems
Market Cap
US$11.0b
Last Updated
2020/06/01 10:10 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.
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's share price has been volatile over the past 3 months.
Market Performance
7 Day Return
5.2%
VAR
3.3%
US Medical Equipment
3.0%
US Market
1 Year Return
-3.2%
VAR
17.2%
US Medical Equipment
9.9%
US Market
Return vs Industry: VAR underperformed the US Medical Equipment industry which returned 17.2% over the past year.
Return vs Market: VAR underperformed the US Market which returned 9.9% over the past year.
Shareholder returns
| VAR | Industry | Market | |
|---|---|---|---|
| 7 Day | 5.2% | 3.3% | 3.0% |
| 30 Day | 9.0% | 6.3% | 8.2% |
| 90 Day | -3.3% | 6.2% | 0.4% |
| 1 Year | -3.2%-3.2% | 18.2%17.2% | 12.4%9.9% |
| 3 Year | 19.2%19.2% | 59.3%55.0% | 31.0%22.3% |
| 5 Year | 58.8%40.9% | 109.0%87.6% | 58.1%40.3% |
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
6 days ago | Simply Wall St
What Can We Make Of Varian Medical Systems, Inc.’s (NYSE:VAR) High Return On Capital?2 weeks ago | Simply Wall St
A Look At The Fair Value Of Varian Medical Systems, Inc. (NYSE:VAR)Valuation
Is Varian Medical Systems undervalued compared to its fair value and its price relative to the market?
47.66x
Price to Earnings (PE) ratio
Share Price vs. Fair Value
Below Fair Value: VAR ($121.39) is trading above our estimate of fair value ($117.53)
Significantly Below Fair Value: VAR is trading above our estimate of fair value.
Price To Earnings Ratio
PE vs Industry: VAR is good value based on its PE Ratio (47.7x) compared to the Medical Equipment industry average (47.8x).
PE vs Market: VAR is poor value based on its PE Ratio (47.7x) compared to the US market (15.7x).
Price to Earnings Growth Ratio
PEG Ratio: VAR is poor value based on its PEG Ratio (1.6x)
Price to Book Ratio
PB vs Industry: VAR is overvalued based on its PB Ratio (5.9x) compared to the US Medical Equipment industry average (3.8x).
Next Steps
Future Growth
How is Varian Medical Systems forecast to perform in the next 1 to 3 years based on estimates from 10 analysts?
30.7%
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: VAR's forecast earnings growth (30.7% per year) is above the savings rate (2.2%).
Earnings vs Market: VAR's earnings (30.7% per year) are forecast to grow faster than the US market (22% per year).
High Growth Earnings: earnings are expected to grow significantly over the next 3 years.
Revenue vs Market: VAR's revenue (10.6% per year) is forecast to grow faster than the US market (8.8% per year).
High Growth Revenue: VAR's revenue (10.6% 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 (17.1%).
Next Steps
Past Performance
How has Varian Medical Systems performed over the past 5 years?
-9.0%
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: VAR has a large one-off loss of $154.1M impacting its April 3 2020 financial results.
Growing Profit Margin: VAR's current net profit margins (7%) are lower than last year (12.4%).
Past Earnings Growth Analysis
Earnings Trend: VAR's earnings have declined by -9% per year over the past 5 years.
Accelerating Growth: VAR's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.
Earnings vs Industry: VAR had negative earnings growth (-38.7%) over the past year, making it difficult to compare to the Medical Equipment industry average (7.2%).
Return on Equity
High ROE: VAR's Return on Equity (12.4%) is considered low.
Next Steps
Financial Health
How is Varian Medical Systems's financial position?
Financial Position Analysis
Short Term Liabilities: VAR's short term assets ($2.5B) exceed its short term liabilities ($1.9B).
Long Term Liabilities: VAR's short term assets ($2.5B) exceed its long term liabilities ($523.5M).
Debt to Equity History and Analysis
Debt Level: VAR's debt to equity ratio (27.8%) is considered satisfactory.
Reducing Debt: VAR's debt to equity ratio has reduced from 30.5% to 27.8% over the past 5 years.
Debt Coverage: VAR's debt is well covered by operating cash flow (72.8%).
Interest Coverage: VAR's interest payments on its debt are well covered by EBIT (211.3x coverage).
Balance Sheet
Next Steps
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?
1.2yrs
Average management tenure
CEO
Dow Wilson (60yo)
7.75yrs
Tenure
US$9,446,296
Compensation
Mr. Dow R. Wilson has been the Chief Executive Officer and President of Varian Medical Systems, Inc. since September 29, 2012. Mr. Wilson has been an Independent Director of Agilent Technologies, Inc. sinc ...
CEO Compensation Analysis
Compensation vs Market: Dow's total compensation ($USD9.45M) is about average for companies of similar size in the US market ($USD11.60M).
Compensation vs Earnings: Dow's compensation has been consistent with company performance over the past year.
Leadership Team
| Name | Position | Tenure | Compensation | Ownership |
|---|---|---|---|---|
| President | 7.75yrs | US$9.45m | 0.091% $10.0m | |
| Chief Growth Officer & President of Proton Solutions | no data | US$3.55m | 0.030% $3.3m | |
| President of Varian Oncology Systems | no data | US$2.22m | 0.0018% $197.3k | |
| Senior VP of Finance & CFO | 0.50yr | no data | 0.0010% $111.3k | |
| Senior Vice President of Global Operations | 1.17yrs | no data | no data | |
| Senior VP | no data | no data | 0.00099% $109.1k | |
| Senior VP & Chief Information Officer | 0.58yr | no data | no data | |
| VP of Investor Relations & Treasurer | no data | no data | no data | |
| Director of Public Relations | no data | no data | no data | |
| Senior Vice President of Business Development and Strategy | 5.08yrs | no data | no data |
1.2yrs
Average Tenure
55yo
Average Age
Experienced Management: VAR's management team is not considered experienced ( 1.2 years average tenure), which suggests a new team.
Board Members
| Name | Position | Tenure | Compensation | Ownership |
|---|---|---|---|---|
| President | 7.75yrs | US$9.45m | 0.091% $10.0m | |
| Independent Director | 3.83yrs | US$281.25k | 0.0061% $674.7k | |
| Independent Chairman | 6.33yrs | US$372.00k | 0.014% $1.6m | |
| Independent Director | 0.83yr | US$25.00k | 0.00053% $58.4k | |
| Independent Director | 1.67yrs | US$321.20k | 0.0018% $194.0k | |
| Independent Director | 3.25yrs | US$272.62k | 0.0035% $386.9k | |
| Independent Director | 8.83yrs | US$257.00k | 0.016% $1.7m | |
| Independent Director | 6.5yrs | US$265.75k | 0.012% $1.4m | |
| Independent Director | 0.58yr | no data | no data | |
| Independent Director | 1.5yrs | US$276.81k | 0.0015% $164.3k |
3.5yrs
Average Tenure
58.5yo
Average Age
Experienced Board: VAR's board of directors are considered experienced (3.5 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.
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$11.024b
- Shares outstanding: 90.81m
- Website: https://www.varian.com
Number of Employees
Location
- Varian Medical Systems, Inc.
- 3100 Hansen Way
- Palo Alto
- California
- 94304
- United States
Listings
| Ticker | Exchange | Primary Security | Security Type | Country | Currency | Listed on |
|---|---|---|---|---|---|---|
| VAR | NYSE (New York Stock Exchange) | Yes | Common Stock | US | USD | Jan 1968 |
| VNM | DB (Deutsche Boerse AG) | Yes | Common Stock | DE | EUR | Jan 1968 |
| 0LNU | LSE (London Stock Exchange) | Yes | Common Stock | GB | USD | Jan 1968 |
| VAR * | BMV (Bolsa Mexicana de Valores) | Yes | Common Stock | MX | MXN | Jan 1968 |
| V1AR34 | BOVESPA (Bolsa de Valores de Sao Paulo) | BDR EACH 2 REPR 1 COM | BR | BRL | Jan 2020 |
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 in Oncology Systems and Proton Solutions segments. The Oncology Systems segment offers hardware and software products for treating cancer with radiotherapy, fixed field intensity-modulated radiation therapy, image-guided radiation therapy, volumetric modulated arc therapy, stereotactic radiosurgery, stereotactic body radiotherapy, and brachytherapy, as well as quality assurance equipment. Its products include linear accelerators, brachytherapy after loaders, treatment accessories, and quality assurance software; and information management, treatment planning, image processing, clinical knowledge exchange, patient care management, decision-making support, and practice management software. This segment serves university research and community hospitals, private and governmental institutions, healthcare agencies, physicians’ offices, medical oncology practices, radiotherapy centers, and cancer care clinics. The Proton Solutions segment designs, develops, manufactures, sells, and services products and systems for delivering proton therapy for the treatment of cancer. The company has a strategic agreement with Siemens AG; and partnership agreement with Siemens AG, as well as with The National University Cancer Institute. Varian Medical Systems was formerly known as Varian Associates, Inc. and changed its name to Varian Medical Systems, Inc. in April 1999. The company was founded in 1948 and is headquartered in Palo Alto, California.
Company Analysis and Financial Data Status
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2020/06/01 10:10 |
| End of Day Share Price | 2020/05/29 00:00 |
| Earnings | 2020/04/03 |
| Annual Earnings | 2019/09/27 |
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.