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Smiths Group
(OTC:SMGZY)
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Rating:66Neutral
Price Target:
$38.00
▲(7.16% Upside)
Action:Downgraded
Date:08/04/26
The score is driven primarily by solid financial quality (strong margins, improving cash flow, and conservative leverage) and supportive technical momentum (price above major moving averages with a positive MACD). This is meaningfully offset by valuation risk, as the high P/E and modest dividend yield make the stock less attractive on price.
Positive Factors
Strong Profitability
Sustained profitability and healthy operating margins indicate effective cost control and operational efficiency, providing resilience if demand remains uneven across industrial, security, aerospace, and communications markets.
Negative Factors
Revenue Contraction
The decline in revenue signals weaker demand or competitive pressure and could limit operating leverage. Sustained contraction would make it harder to preserve margins and support consistent growth across divisions.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong Profitability
Sustained profitability and healthy operating margins indicate effective cost control and operational efficiency, providing resilience if demand remains uneven across industrial, security, aerospace, and communications markets.
Read all positive factors
Smiths Group (SMGZY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$9.76B
Dividend Yield1.75%
Average Volume (3M)2.94K
Price to Earnings (P/E)33.1
Beta (1Y)0.60
Revenue Growth-28.51%
EPS Growth-9.65%
CountryUS
Employees16,103
SectorIndustrials
Sector Strength72
IndustryIndustrial - Machinery
Share Statistics
EPS (TTM)0.76
Shares Outstanding287,542,300
10 Day Avg. Volume3,685
30 Day Avg. Volume2,942
Financial Highlights & Ratios
PEG Ratio2.36
Price to Book (P/B)4.01
Price to Sales (P/S)2.80
P/FCF Ratio21.26
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 ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)1.53
Revenue Forecast (FY)$2.76B
Smiths Group Business Overview & Revenue Model
Company Description
Smiths Group plc is a global technology enterprise, delivering specialized solutions to a wide array of markets, including medical technology, defense and security, industrial manufacturing, energy, and aerospace. The company's operations are stru...
How the Company Makes Money
Smiths Group makes money primarily by selling products, systems, and services through its four operating divisions. (1) John Crane generates revenue from mechanical seals, seal support systems, couplings, filtration and other rotating-equipment so...
Smiths Group Earnings Call Summary
Earnings Call Date:Sep 23, 2025
(Q4-2025)
| % Change Since: |
Next Earnings Date:Sep 22, 2026
Earnings Call Sentiment Positive
The earnings call reflects a strong financial performance with consecutive years of organic growth and increased shareholder returns. While there are challenges such as the cyber incident's impact on John Crane and a subdued U.S. construction market, the positive growth in Smiths Detection and Smiths Interconnect, along with operational improvements and strategic plans, provide a robust outlook.Positive Updates
Consistent Organic Revenue Growth
Fiscal year 2025 marks the fourth consecutive year of organic revenue growth, with group organic revenue up 8.9%, surpassing the 6% to 8% guidance.
Negative Updates
Impact of Cyber Incident on John Crane
The cyber incident caused operational challenges, particularly affecting the aftermarket and delaying recovery.
Read all updates
Q4-2025 Updates
Positive
Negative
Consistent Organic Revenue Growth
Fiscal year 2025 marks the fourth consecutive year of organic revenue growth, with group organic revenue up 8.9%, surpassing the 6% to 8% guidance.
Read all positive updates
Company Guidance
In the recent call, Smiths Group exceeded its fiscal year 2025 guidance, achieving an organic revenue growth of 8.9%, surpassing the expected 6% to 8% range. They expanded operating profit margins by 60 basis points to 17.4%, at the top end of the 40 to 60 basis points guidance. The company also marked a 5.1% increase in dividends, continuing a 74-year streak of dividend payments. Smiths executed three accretive acquisitions and progressed the separation of Smiths Interconnect and Smiths Detection, reporting Interconnect as discontinued operations. Looking ahead, the company anticipates 4% to 6% organic revenue growth for fiscal year 2026, with ongoing margin expansion. Earnings per share rose by 14.8%, and the return on capital employed increased by 170 basis points to 18.1%. Smiths also maintained a strong cash conversion rate of 99%, with a free cash flow of GBP 336 million, reflecting their disciplined capital allocation and strategic focus on sustainable growth and shareholder value.Smiths Group Financial Statement Overview
Summary
Income Statement
65
Positive
Balance Sheet
70
Positive
Cash Flow
75
Positive
| Breakdown | TTM | Jul 2025 | Jul 2024 | Jul 2023 | Jul 2022 | Jul 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.20B | 2.92B | 3.13B | 3.04B | 2.57B | 2.41B |
| Gross Profit | 176.18M | 410.00M | 1.17B | 1.12B | 961.00M | 915.00M |
| EBITDA | 460.32M | 535.00M | 580.00M | 580.00M | 287.00M | 430.00M |
| Net Income | 249.16M | 292.00M | 250.00M | 231.00M | 1.03B | 284.00M |
Balance Sheet | ||||||
| Total Assets | 4.14B | 4.01B | 4.23B | 4.36B | 5.22B | 5.34B |
| Cash, Cash Equivalents and Short-Term Investments | 345.00M | 195.00M | 459.00M | 285.00M | 1.06B | 405.00M |
| Total Debt | 1.21B | 667.00M | 659.00M | 654.00M | 1.17B | 1.50B |
| Total Liabilities | 2.46B | 1.95B | 1.98B | 1.95B | 2.50B | 2.91B |
| Stockholders Equity | 1.66B | 2.04B | 2.23B | 2.38B | 2.70B | 2.40B |
Cash Flow | ||||||
| Free Cash Flow | 382.26M | 384.00M | 332.00M | 212.00M | 191.00M | 418.00M |
| Operating Cash Flow | 458.02M | 456.00M | 418.00M | 293.00M | 279.00M | 535.00M |
| Investing Cash Flow | -128.89M | -160.00M | 39.00M | -108.00M | 1.25B | -205.00M |
| Financing Cash Flow | -351.32M | -517.00M | -269.00M | -945.00M | -985.00M | -239.00M |
Smiths Group Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $28.36B | 29.77 | 9.46% | 0.11% | 7.85% | 88.74% | |
75 Outperform | $17.54B | 39.87 | 10.35% | 0.74% | 28.07% | -19.95% | |
72 Outperform | $9.26B | 25.85 | 16.63% | 1.15% | -0.26% | 29.38% | |
72 Outperform | $929.31M | 14.27 | 37.18% | ― | 13.17% | -38.92% | |
70 Outperform | $16.33B | 32.17 | 12.91% | 1.28% | 7.32% | 12.36% | |
66 Neutral | $9.76B | 33.08 | 13.71% | 1.75% | -28.51% | -9.65% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% |
* Industrials Sector Average
SMGZY
Smiths Group
34.46
2.85
9.03%
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34.06%
IEX
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ITT
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PSIX
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IR
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-7.34%
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.