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Steris
(NYSE:STE)
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Rating:72Outperform
Price Target:
$249.00
▲(5.31% Upside)
Action:Reiterated
Date:09/07/26
The score is primarily driven by strong financial performance—healthy profitability, conservative leverage, and generally solid cash generation—offset by softer recent free-cash-flow momentum. Technical indicators are currently mixed-to-weak with price below key moving averages and subdued momentum. Valuation is on the higher side (P/E ~27.4) with only a modest dividend yield, while recent corporate events are constructive but include restructuring costs and reduced free-cash-flow expectations.
Positive Factors
Recurring Installed-Base Model
The combination of capital equipment, replenished consumables and service contracts creates multiple revenue streams across each installed customer base. This supports recurring demand, strengthens customer relationships in regulated settings, and can make revenue more durable than equipment sales alone.
Negative Factors
Declining Free Cash Flow Momentum
Although cash generation remains positive, declining free cash flow and conversion below net income indicate that earnings are not translating into expanding discretionary cash at present. If sustained, this could constrain reinvestment, shareholder returns, or flexibility around capital spending.
Read all positive and negative factors
Positive Factors
Negative Factors
Recurring Installed-Base Model
The combination of capital equipment, replenished consumables and service contracts creates multiple revenue streams across each installed customer base. This supports recurring demand, strengthens customer relationships in regulated settings, and can make revenue more durable than equipment sales alone.
Read all positive factors
Steris Key Performance Indicators (KPIs)
Any
Operating Margin by Segment
Measures the efficiency of each segment in converting revenue into profit, indicating competitive strengths or weaknesses and potential areas for cost optimization.
Measures the efficiency of each segment in converting revenue into profit, indicating competitive strengths or weaknesses and potential areas for cost optimization.
Data provided by:
The Fly
The FlySteris (STE) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$21.90B
Dividend Yield1.15%
Average Volume (3M)695.95K
Price to Earnings (P/E)27.4
Beta (1Y)0.38
Revenue Growth8.37%
EPS Growth23.94%
CountryUS
Employees17,937
SectorHealthcare
Sector Strength45
IndustryMedical - Specialties
Share Statistics
EPS (TTM)8.20
Shares Outstanding97,500,110
10 Day Avg. Volume566,229
30 Day Avg. Volume695,945
Financial Highlights & Ratios
PEG Ratio1.03
Price to Book (P/B)3.02
Price to Sales (P/S)3.66
P/FCF Ratio22.33
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 Target
$271.33Price Target Upside14.76% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
EPS Forecast (FY)11.2
Revenue Forecast (FY)$6.38B
Steris Business Overview & Revenue Model
Company Description
STERIS plc provides infection prevention products and services in the United States, Ireland, and internationally. The company operates through three segments: Healthcare, Applied Sterilization Technologies, and Life Sciences. It offers a range of...
How the Company Makes Money
STERIS makes money primarily by selling a mix of capital equipment, recurring consumables, and service-based offerings to healthcare and life-science customers. (1) Product revenue includes sales of sterilizers, washers, disinfectors, and other in...
Steris Earnings Call Summary
Earnings Call Date:May 11, 2026
(Q4-2026)
| % Change Since: |
Next Earnings Date:Nov 11, 2026
Earnings Call Sentiment Positive
The call presents a predominantly positive financial and operational picture: STERIS delivered a record fiscal 2026 with double-digit adjusted EPS growth, exceptional free cash flow (~$983M), stronger leverage (gross debt/EBITDA ~1.2x), and multiple segment milestones (Healthcare, AST, Life Sciences). Management provided constructive FY2027 guidance (7–8% revenue growth, EPS up ~9–11%, modest margin expansion) while continuing shareholder returns (dividend increase, $1B buyback authorization) and strategic investments (manufacturing consolidation, tuck-in M&A, AI for service). Offsetting these positives are tangible near-term headwinds: tariff costs (~$60–65M annual spend with no refunds assumed), higher effective tax rates due to withholding and geographic mix, Q4 margin compression, AST service softness and inventory-led demand variability, and a forecasted reduction in free cash flow for FY2027. Overall, the highlights — record growth, strong cash generation, prudent capital allocation, and constructive guidance — outweigh the lowlights, which are manageable but notable operational and tax/tariff risks.Positive Updates
Record Fiscal 2026 Revenue and Earnings
Total company revenue of approximately $6.0 billion for fiscal 2026, a 9% increase year-over-year (7% constant currency organic 7%? actually 7% constant currency organic for the year was reported earlier; transcript states 9% revenue growth, 7% constant currency organic). Adjusted diluted EPS of $10.17 for FY2026, representing 10% adjusted EPS growth year-over-year.
Negative Updates
Margin Pressure in Q4 and Tax Headwinds
Q4 gross margin declined 30 basis points to 44% and Q4 EBIT margin was 60 basis points below the prior-year quarter; adjusted effective tax rate in Q4 was 25.4% (up from 23.5% prior-year quarter) and full-year FY2026 adjusted effective tax rate rose to 24.4% (up 130 basis points versus FY2025), constraining EPS growth in the quarter.
Read all updates
Q4-2026 Updates
Positive
Negative
Record Fiscal 2026 Revenue and Earnings
Total company revenue of approximately $6.0 billion for fiscal 2026, a 9% increase year-over-year (7% constant currency organic 7%? actually 7% constant currency organic for the year was reported earlier; transcript states 9% revenue growth, 7% constant currency organic). Adjusted diluted EPS of $10.17 for FY2026, representing 10% adjusted EPS growth year-over-year.
Read all positive updates
Company Guidance
STERIS guided FY2027 as‑reported revenue growth of 7–8% (6–7% constant‑currency organic), assuming ~200 bps of price and roughly $45 million of inorganic revenue from two tuck‑in acquisitions; segment guidance is Healthcare and Life Sciences each 6–7% cc organic and AST 7–8% cc organic. Management expects approximately 50 bps of EBIT margin expansion (assuming tariff spending flat year‑over‑year and a modest incentive‑compensation tailwind), an adjusted effective tax rate around 25%, EPS of $11.10–$11.30 (up ~9–11% vs FY2026’s $10.17), and tariffs modeled at roughly $60–65 million (FY2026 incremental tariffs were $46 million). Free cash flow is forecast at about $850 million with CapEx ~$375 million (including ~ $60 million over two years for a new sterility‑assurance plant), net working capital to grow with volumes, roughly $50 million of incentive compensation payable in June plus remaining EO settlement payments through the year, and a capital return plan featuring a new $1 billion buyback authorization with expected annual repurchases of $200–$300 million.Steris Financial Statement Overview
Summary
Income Statement
82
Very Positive
Balance Sheet
88
Very Positive
Cash Flow
76
Positive
| Breakdown | TTM | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 6.04B | 5.94B | 5.46B | 5.14B | 4.54B | 4.22B |
| Gross Profit | 2.68B | 2.63B | 2.40B | 2.22B | 1.98B | 1.88B |
| EBITDA | 1.81B | 1.59B | 1.36B | 1.41B | 1.23B | 1.01B |
| Net Income | 805.10M | 785.10M | 614.64M | 378.24M | 107.03M | 243.89M |
Balance Sheet | ||||||
| Total Assets | 10.74B | 10.74B | 10.15B | 11.06B | 10.82B | 11.42B |
| Cash, Cash Equivalents and Short-Term Investments | 482.30M | 439.60M | 171.70M | 207.02M | 208.36M | 348.32M |
| Total Debt | 2.04B | 2.09B | 2.20B | 3.38B | 3.25B | 3.28B |
| Total Liabilities | 3.51B | 3.54B | 3.53B | 4.75B | 4.73B | 4.88B |
| Stockholders Equity | 7.21B | 7.18B | 6.60B | 6.30B | 6.08B | 6.53B |
Cash Flow | ||||||
| Free Cash Flow | 925.60M | 972.40M | 778.00M | 612.95M | 394.98M | 397.25M |
| Operating Cash Flow | 1.29B | 1.34B | 1.15B | 973.27M | 756.95M | 684.81M |
| Investing Cash Flow | -512.50M | -512.50M | 388.77M | -887.36M | -383.33M | -666.56M |
| Financing Cash Flow | -568.60M | -568.20M | -1.57B | -85.19M | -498.72M | 115.83M |
Steris Technical Analysis
Negative
236.44
Price Trends
224.65
Negative
218.31
Positive
231.50
Negative
Market Momentum
0.55
Positive
41.11
Neutral
16.15
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For STE, the sentiment is Negative. The current price of 236.44 is above the 20-day moving average (MA) of 233.21, above the 50-day MA of 224.65, and above the 200-day MA of 231.50, indicating a bearish trend. The MACD of 0.55 indicates Positive momentum. The RSI at 41.11 is Neutral, neither overbought nor oversold. The STOCH value of 16.15 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for STE.
Steris Risk Analysis
Steris disclosed 34 risk factors in its most recent earnings report. Steris reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Steris Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $21.90B | 27.39 | 11.27% | 1.15% | 8.37% | 23.94% | |
62 Neutral | $278.50M | -77.22 | -2.70% | ― | -2.50% | 93.57% | |
61 Neutral | $715.04M | 148.58 | 2.59% | 0.50% | 3.04% | ― | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
49 Neutral | $958.00M | -0.90 | -55.30% | ― | -2.57% | -135.75% | |
46 Neutral | $128.48M | -14.76 | -78.70% | ― | 25.59% | 55.35% | |
42 Neutral | $6.07M | -0.16 | 68.09% | 1.23% | -13.28% | 39.65% |
* Healthcare Sector Average
STE
Steris
224.59
-21.01
-8.55%
ANIK
Anika Therapeutics
20.81
11.87
132.77%
APYX
Apyx Medical
3.05
0.99
48.06%
MLAB
Mesa Laboratories
127.78
64.43
101.71%
QDEL
QuidelOrtho
13.97
-14.50
-50.93%
TRIB
Trinity Biotech
9.41
-24.19
-71.99%
Steris Corporate Events
Business Operations and StrategyExecutive/Board ChangesShareholder Meetings
Steris Shareholders Approve Governance and Capital Authority Measures
Positive
Aug 6, 2026
At its Annual General Meeting of Shareholders held on July 31, 2026, Steris plc reported a quorum with more than 92% of outstanding ordinary shares represented and reduced the size of its board to nine members. Shareholders elected all nominated d...
Business Operations and StrategyFinancial Disclosures
Steris Posts Solid Q1 Results Amid Restructuring Plans
Positive
Aug 5, 2026
On August 5, 2026, STERIS reported fiscal 2027 first-quarter results showing 7% revenue growth to $1.5 billion and a rise in diluted EPS to $2.04, with adjusted EPS at $2.59. Growth was driven largely by its Healthcare segment, where higher consum...
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.