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Embecta Corporation
(NASDAQ:EMBC)
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Rating:60Neutral
Price Target:
$5.00
▲(51.98% Upside)
Action:Reiterated
Date:08/09/26
The score is primarily constrained by financial risk from a highly leveraged capital structure (negative equity and substantial debt) despite solid current profitability and cash generation. The earnings call adds cautious support due to raised margin and EPS guidance and continued deleveraging plans, while revenue weakness—especially in the U.S.—remains a notable drag. Valuation is compelling (very low P/E and high dividend yield), but the market’s risk pricing and only mixed technical posture keep the overall score in the middle range.
Positive Factors
Cash Generation
Consistent positive operating and free cash flow indicates the core business converts earnings into cash. This supports debt repayment, funding of capex and M&A (e.g., Owen Mumford), and provides flexibility to sustain operations and investments over the next 2–6 months.
Negative Factors
Highly Levered Balance Sheet
Persistently negative equity and elevated debt materially limit financial flexibility and increase refinancing and covenant sensitivity. This structural leverage makes the company vulnerable to earnings volatility and constrains capital allocation choices for several months to come.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash Generation
Consistent positive operating and free cash flow indicates the core business converts earnings into cash. This supports debt repayment, funding of capex and M&A (e.g., Owen Mumford), and provides flexibility to sustain operations and investments over the next 2–6 months.
Read all positive factors
Embecta Corporation (EMBC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$276.50M
Dividend Yield9.68%
Average Volume (3M)2.04M
Price to Earnings (P/E)3.2
Beta (1Y)0.78
Revenue Growth-7.60%
EPS Growth4.11%
CountryUS
Employees1,850
SectorHealthcare
Sector Strength45
IndustryDrug Manufacturers - Specialty & Generic
Share Statistics
EPS (TTM)1.49
Shares Outstanding56,659,600
10 Day Avg. Volume1,215,714
30 Day Avg. Volume2,041,617
Financial Highlights & Ratios
PEG Ratio0.42
Price to Book (P/B)-1.26
Price to Sales (P/S)0.76
P/FCF Ratio4.51
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusModerate Sell
Number of Analyst Covering2
EPS Forecast (FY)1.59
Revenue Forecast (FY)$1.02B
Embecta Corporation Business Overview & Revenue Model
Company Description
Embecta Corp. is a medical technology enterprise devoted to enhancing the quality of life and health outcomes for individuals living with diabetes. Its comprehensive product portfolio includes essential tools such as pen needles, syringes, and adv...
How the Company Makes Money
Embecta makes money primarily by selling diabetes-care medical devices to healthcare providers, pharmacies, distributors, and other channel partners in markets where insulin injections are commonly used. Its core revenue stream is the recurring, c...
Embecta Corporation Earnings Call Summary
Earnings Call Date:Aug 07, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Dec 01, 2026
Earnings Call Sentiment Neutral
The call presents a mixed picture: significant strategic progress (Owen Mumford acquisition expanding TAM, international growth, sequential operational improvement, margin/earnings guidance upgrades, brand transition and organizational reinforcements) offset by sizable year‑over‑year declines in U.S. revenue, gross profit and operating profit, pen needle headwinds, and macro volume pressures. Management emphasized execution, cost controls, and deleveraging while reaffirming revenue guidance and raising margin and EPS targets, resulting in cautious optimism but clear near‑term financial challenges.Positive Updates
Owen Mumford Acquisition and Strategic Expansion
Closed acquisition of Owen Mumford on May 15; integration progressing as planned. Expands product portfolio beyond insulin devices into pharmaceutical services and auto-injectors (Aidaptus). Management estimates total addressable auto-injector market ≈ $2.4B with double-digit CAGR. Added 4 sites (3 manufacturing: 2 UK, 1 Malaysia; 1 U.S. warehouse) to broaden manufacturing/distribution footprint.
Negative Updates
Overall Year‑Over‑Year Revenue Decline
Total Q3 revenue ≈ $272M, down 8.1% year‑over‑year on an as‑reported basis and down 8.9% on an adjusted constant currency basis. Reaffirmed FY26 revenue guidance of $1.015B–$1.035B, implying a year‑over‑year decline of 4.2%–6.1%.
Read all updates
Q3-2026 Updates
Positive
Negative
Owen Mumford Acquisition and Strategic Expansion
Closed acquisition of Owen Mumford on May 15; integration progressing as planned. Expands product portfolio beyond insulin devices into pharmaceutical services and auto-injectors (Aidaptus). Management estimates total addressable auto-injector market ≈ $2.4B with double-digit CAGR. Added 4 sites (3 manufacturing: 2 UK, 1 Malaysia; 1 U.S. warehouse) to broaden manufacturing/distribution footprint.
Read all positive updates
Company Guidance
Embecta reaffirmed full‑year fiscal 2026 revenue guidance of $1.015–$1.035 billion (a y/y decline of ~4.2%–6.1%), raised adjusted operating margin guidance to 23.5%–24% (from 22.25%–23.25%) and raised adjusted EPS to $1.80–$1.90 (from $1.55–$1.75), while forecasting FX to be a ~1.3% tailwind (vs. prior ~1.5%), an adjusted tax rate of ~27% (vs. ~28% prior), interest expense of ~$95 million (vs. ~$97M prior), and a weighted average diluted share count of ~58.6 million (vs. ~59.4M prior) — guidance also assumes at least $150 million of debt repayment in 2026 (about $128M repaid in the first 9 months), roughly $100 million of free cash flow, and ~$18–$20 million of capital expenditures (mostly in Q4); management raised M&A expectations for Owen Mumford given the deal closed two weeks earlier and noted adjusted organic constant‑currency assumptions with the high end modestly lowered due to U.S. customer/payer mix.Embecta Corporation Financial Statement Overview
Summary
Income Statement
52
Neutral
Balance Sheet
18
Very Negative
Cash Flow
63
Positive
| Breakdown | TTM | Sep 2025 | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.02B | 1.08B | 1.12B | 1.12B | 1.13B | 1.17B |
| Gross Profit | 610.10M | 679.50M | 728.90M | 749.90M | 774.90M | 800.00M |
| EBITDA | 273.70M | 294.70M | 199.00M | 245.40M | 334.50M | 533.00M |
| Net Income | 87.50M | 95.40M | 78.30M | 70.40M | 223.60M | 414.80M |
Balance Sheet | ||||||
| Total Assets | 1.27B | 1.09B | 1.29B | 1.21B | 1.09B | 788.00M |
| Cash, Cash Equivalents and Short-Term Investments | 214.70M | 225.50M | 267.50M | 326.50M | 330.90M | 0.00 |
| Total Debt | 1.50B | 1.43B | 1.61B | 1.64B | 1.64B | 4.10M |
| Total Liabilities | 1.88B | 1.74B | 2.02B | 2.04B | 1.98B | 194.00M |
| Stockholders Equity | -612.70M | -651.20M | -738.30M | -821.70M | -891.40M | 594.00M |
Cash Flow | ||||||
| Free Cash Flow | 164.60M | 182.40M | 19.90M | 41.20M | 388.20M | 417.00M |
| Operating Cash Flow | 174.10M | 191.70M | 35.70M | 67.70M | 412.20M | 456.00M |
| Investing Cash Flow | -127.80M | -9.30M | -15.80M | -26.50M | -24.00M | -39.00M |
| Financing Cash Flow | -62.30M | -226.70M | -73.40M | -48.70M | -48.00M | -417.00M |
Embecta Corporation Technical Analysis
Neutral
3.29
Price Trends
3.41
Positive
5.20
Negative
8.36
Negative
Market Momentum
0.29
Negative
74.06
Negative
87.00
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EMBC, the sentiment is Neutral. The current price of 3.29 is below the 20-day moving average (MA) of 3.67, below the 50-day MA of 3.41, and below the 200-day MA of 8.36, indicating a neutral trend. The MACD of 0.29 indicates Negative momentum. The RSI at 74.06 is Negative, neither overbought nor oversold. The STOCH value of 87.00 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for EMBC.
Embecta Corporation Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
69 Neutral | $971.83M | 67.31 | 2.13% | ― | 5.71% | ― | |
63 Neutral | $845.79M | 16.80 | 15.96% | ― | 14.31% | 34.35% | |
60 Neutral | $276.50M | 3.19 | -13.98% | 13.98% | -7.60% | 4.11% | |
56 Neutral | $206.93M | -65.83 | -1.53% | ― | -70.13% | -103.41% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
51 Neutral | $243.19M | -2.21 | -0.07% | ― | 6.50% | -613.22% |
* Healthcare Sector Average
EMBC
Embecta Corporation
4.75
-8.63
-64.50%
PCRX
Pacira Pharmaceuticals
23.70
-1.34
-5.35%
SIGA
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2.87
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COLL
Collegium Pharmaceutical
25.70
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-32.12%
ORGO
Organogenesis Holdings
1.81
-3.10
-63.14%
Embecta Corporation Corporate Events
Business Operations and StrategyM&A Transactions
Embecta Completes Owen Mumford Acquisition to Expand Devices
Positive
May 15, 2026
On May 15, 2026, Embecta completed its acquisition of Owen Mumford Holdings Limited, following a March 19, 2026 purchase agreement with the sellers. Embecta paid £100 million in upfront cash, subject to customary closing adjustments, and may ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.