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What this page is: Delvantic's full research page for STERIS plc (STE) — AI-driven forensic equity research: mechanical valuation models (DCF, EPV, anchored-PE, scenario) plus three independent AI lenses (Quality / Value / Sentiment). Everything below is rendered server-side; you are not missing content that requires JavaScript. All scores are predictions and research opinions, not financial advice.
Our current read (analysis of 2026-10-08): Designation Watch · Gem Score -11 (−100…+100 Quality+Value blend) · Quality 69 · Value -65 · Sentiment -8 (timing only, not weighted) · Composite fair value $163.14 vs $226.83 at analysis
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STERIS plc
STE NYSESTERIS plc is a healthcare and life sciences company that provides infection prevention, contamination control, and procedural products and services. The company offers a broad portfolio that includes sterilizers, surgical tables, endoscopy accessories, cleaning chemistries, instrument and scope repair, laboratory testing, and outsourced reprocessing services. Its operations support hospitals, ambulatory surgery centers, pharmaceutical and medical device manufacturers, and research laboratories. STERIS plc also serves biopharmaceutical and life sciences customers with contamination-control equipment, sterilization technologies, and related maintenance services. Through its mix of consumables, capital equipment, and recurring service offerings, the company plays an important role in helping healthcare and production environments maintain sterile conditions and support patient care across global markets.
Price Overview
Price History (1 Year)
Revenue & Net Income Trend
| Period | Revenue | Net Income | Net Margin | YoY/QoQ |
|---|
Key Metrics
EPS (Diluted): 7.93
Total Equity: $7.20B
Shares: 98,700,000
Total Debt: $1.93B
Cash: $439.60M
EBITDA: $1.59B
Total Debt: $1.93B
Cash: $439.60M
Revenue: $5.94B
Revenue: $5.94B
Revenue: $5.94B
Total Equity: $7.20B
Tax Rate: 25.0%
Equity: $7.20B
Total Debt: $1.93B
Cash: $439.60M
Current Liabilities: $1.15B
Long-Term Debt: $1.81B
Total Debt: $1.93B
Total Equity: $7.20B
Shares: 98,700,000
Shares: 98,700,000
CapEx: -$369.00M
Shares: 98,700,000
Stock Price: $226.83
Net Income: $782.30M
Industry Benchmarks
Income Statement (Annual)
Last updated: Sep 4, 2026 4:45am (33d ago)| Metric | 2022 | 2023 | 2024 | 2025 | 2026 |
|---|---|---|---|---|---|
| Revenue | $4.6B | $5.0B | $5.1B | $5.5B | $5.9B |
| Cost of Revenue | $2.6B | $2.8B | $2.9B | $3.1B | $3.3B |
| Gross Profit | $2.0B | $2.2B | $2.2B | $2.4B | $2.6B |
| Operating Expenses | $1.6B | $1.9B | $1.4B | $1.5B | $1.5B |
| Operating Income | $425.6M | $268.2M | $836.1M | $866.6M | $1.1B |
| Net Income | $243.9M | $107.0M | $378.2M | $614.6M | $782.3M |
| EBITDA | $978.7M | $821.1M | $1.4B | $1.3B | $1.6B |
| EPS | $2.50 | $1.07 | $3.83 | $6.24 | $7.97 |
| EPS (Diluted) | $2.48 | $1.07 | $3.81 | $6.20 | $7.93 |
Balance Sheet (Annual)
Last updated: Sep 4, 2026 4:30am (33d ago)| Metric | 2022 | 2023 | 2024 | 2025 | 2026 |
|---|---|---|---|---|---|
| Cash & Equivalents | $348.3M | $208.4M | $207.0M | $171.7M | $439.6M |
| Total Current Assets | $1.9B | $2.0B | $2.9B | $2.0B | $2.4B |
| Total Assets | $11.4B | $10.8B | $11.1B | $10.1B | $10.7B |
| Current Liabilities | $922.2M | $861.8M | $931.1M | $1.0B | $1.1B |
| Long-Term Debt | $2.9B | $3.0B | $3.1B | $1.9B | $1.8B |
| Total Liabilities | $4.9B | $4.7B | $4.7B | $3.5B | $3.5B |
| Total Equity | $6.5B | $6.1B | $6.3B | $6.6B | $7.2B |
| Retained Earnings | $2.0B | $1.9B | $2.1B | $2.5B | $3.0B |
Cash Flow (Annual)
Last updated: Sep 4, 2026 4:59am (33d ago)| Metric | 2022 | 2023 | 2024 | 2025 | 2026 |
|---|---|---|---|---|---|
| Operating Cash Flow | $684.8M | $756.9M | $973.3M | $1.1B | $1.3B |
| Capital Expenditure | -$287.6M | -$362.0M | -$360.3M | -$370.1M | -$369.0M |
| Free Cash Flow | $397.2M | $395.0M | $612.9M | $778.0M | $972.4M |
| Acquisitions (net) | -$550.4M | -$42.6M | -$546.3M | -$54.1M | -$20.1M |
| Net Debt Issued / (Repaid) | $650.0M | $0 | $0 | — | — |
| Dividends Paid | -$163.2M | -$183.5M | -$200.6M | -$219.9M | -$241.8M |
| Stock Buybacks | -$55.8M | -$308.6M | -$11.8M | -$211.3M | -$235.5M |
| Net Change in Cash | $127.8M | -$140.0M | -$1.3M | -$35.3M | $267.9M |
Growth Trends (YoY %)
Last updated: Sep 4, 2026 4:45am (33d ago)| Metric | 2023 | 2024 | 2025 | 2026 |
|---|---|---|---|---|
| Revenue Growth | +8.1% | +3.6% | +6.2% | +8.7% |
| Gross Profit Growth | +7.1% | +2.7% | +8.3% | +9.3% |
| Operating Income Growth | -37.0% | +211.8% | +3.7% | +27.1% |
| Net Income Growth | -56.1% | +253.4% | +62.5% | +27.3% |
| EBITDA Growth | -16.1% | +70.7% | -4.2% | +18.3% |
Dividend History (Last 20)
Last updated: Aug 31, 2026 6:28pm (37d ago)| Date | Dividend | Declaration | Record | Payment |
|---|---|---|---|---|
| 2026-06-08 | $0.63 | — | — | — |
| 2026-02-17 | $0.63 | — | — | — |
| 2025-09-04 | $0.63 | — | — | — |
| 2025-06-10 | $0.57 | — | — | — |
| 2025-02-20 | $0.57 | — | — | — |
| 2024-11-19 | $0.57 | — | — | — |
| 2024-09-05 | $0.57 | — | — | — |
| 2024-06-12 | $0.52 | — | — | — |
| 2024-02-22 | $0.52 | — | — | — |
| 2023-11-20 | $0.52 | — | — | — |
| 2023-09-05 | $0.52 | — | — | — |
| 2023-06-13 | $0.47 | — | — | — |
| 2023-02-23 | $0.47 | — | — | — |
| 2022-11-21 | $0.47 | — | — | — |
| 2022-09-06 | $0.47 | — | — | — |
| 2022-06-13 | $0.43 | — | — | — |
| 2022-02-24 | $0.43 | — | — | — |
| 2021-11-22 | $0.43 | — | — | — |
| 2021-09-02 | $0.43 | — | — | — |
| 2021-05-27 | $0.40 | — | — | — |
Deep Analysis
Risk : Reward — upside vs downside from this company's own quarters
Computed 2026-10-08 02:02A +1σ run of quarters pays -49%; a −1σ run costs 62%. Ratio -0.8:1 (μ 7.4%, σ 3.0% floored by absolute, 16 pairs).
Older method (repeat-worst-quarter): -0.7 : 1
| Case | Growth | Margin | Fair value | vs price ($226.83) |
|---|---|---|---|---|
| Bull — recovery | +11% | 17.3% | $138.18 | -39% |
| Base — stabilizes | +7% | 15.0% | $108.29 | -52% |
| Bear — keeps slipping | +4% | 12.8% | $83.25 | -63% |
| Stress — last quarter repeats | +7% | 14.4% | $104.24 | -54% |
| Upside — a +1σ run of quarters (v2) | +10% | 14.7% | $116.39 | -49% |
| Stress — a −1σ run of quarters (v2) | +4% | 12.9% | $85.57 | -62% |
Narrative Economics
market-narrative step).
Growth Outlook
Analyzed 2026-09-04 05:37The question every valuation on this page silently assumes: is this company likely to grow? Judged forward — the business, its category, the world — against what's already printed.
Claude Reading
ai-findings step) when a report is run on this ticker.
GPT Reading
STERIS looks like a high-quality business that the market is valuing as if quality alone is enough. The operating story is genuinely good: annual revenue has climbed from $4.59B in FY2022 to $5.94B in FY2026, about 6.7% annualized, while operating income expanded from $425.6M to $1.10B and net income from $243.9M to $782.3M. More important than the raw growth is the normalization in profitability after the ugly FY2023 trough: operating margin recovered from 5.4% in 2023 to 16.3% in 2025 and 18.6% in 2026, with net margin now 13.2%. Quarterly numbers support that this is not a one-quarter spike. The last four quarters delivered revenue of $1.46B, $1.50B, $1.59B, and $1.49B, with net margins tightly grouped around 12.9%-13.9%. That consistency, plus $1.34B of operating cash flow and $972.4M of free cash flow in FY2026, says the core franchise is durable and cash generative.
The balance sheet is also better than the valuation implies it needs to be. Net debt is only about $1.49B against a $22.1B market cap, debt to equity is 0.27, and the current ratio is 2.09. This is not a stressed medtech roll-up needing heroic assumptions. Return metrics are respectable rather than spectacular — 10.9% ROE and 9.5% ROIC — but they are improving alongside margins. That matters because the stock is not a turnaround bet; it is being priced like a proven compounder. At $226.83, investors are paying 28.6x earnings, 15.0x EV/EBITDA, 3.77x sales, and only getting a roughly 4.4% FCF yield on market cap, or closer to 4% on enterprise value. For a business growing revenue high-single-digits and likely earnings low-to-mid teens as margins stabilize, that is not absurd, but it is full. The key issue is that the rerating has already happened: the jump from $614.6M to $782.3M in annual net income has been capitalized as though this new margin level is both durable and still has room to expand meaningfully.
What stands out to me is that the numbers argue for “excellent company, ordinary stock from here,” not for a clear undervaluation. The models calling it fully priced are directionally right even if their fair value outputs are too blunt. If I annualize the most recent quarter’s $200.1M of net income, I get about $800M, which is basically where trailing earnings already sit. That means today’s multiple is being applied to current, not depressed, earnings. Revenue growth also looks solid but not accelerating into something that deserves a premium above many other high-quality device names: quarterly year-over-year growth stepped from about 4.5% in the March 2025 quarter to 8.7% in June 2026, but sequentially the business still looks like a mature operator, not an emerging growth story. With gross margin at 44.3% and operating margin at 18.6%, there is probably some efficiency left, but not enough to justify paying materially above the current multiple unless revenue can sustain double-digit growth.
The best counterargument is that I may be underestimating how attractive this specific quality is. A smart bull would point to the recovery path: from FY2024 to FY2026, revenue rose 15.6% while operating income rose 31.6% and net income more than doubled from $378.2M to $782.3M. That is classic operating leverage. They would also argue that free cash flow of $972.4M against capex of $369.0M shows a business that can keep investing and still throw off nearly $1B a year, which supports bolt-on M&A, buybacks, and steady dividend growth. On that framing, 15x EBITDA is not expensive for a healthcare infrastructure asset with recurring service and consumables exposure, low leverage, and resilient demand. I get that case; I just think it works better as a defense of the current price than as a reason the shares are cheap. If this were 24x earnings or around 12x-13x EBITDA, I would lean bullish. At nearly 29x, you need both durability and another leg of growth.
What would change my mind is straightforward. I would turn more positive if STERIS can post another two to three quarters of 8%-10% revenue growth while holding net margin above 13% and converting that into annual free cash flow comfortably above $1.0B, because that would support a view that the current earnings base is still too low. I would also reassess if the stock fell into roughly the $190-$205 range without any deterioration in revenue or cash flow, since that would bring the earnings multiple closer to the mid-20s and make the quality/growth mix more attractive. On the other hand, if growth slips back toward 4%-6% while margins flatten around current levels, the premium multiple becomes hard to defend and the stock should de-rate.
Grok Reading
STERIS prints the profile of a high-quality infection-prevention and sterilization franchise that has fully exited its 2023 earnings trough and is now compounding from a normalized base. Fiscal 2026 revenue of $5.94B grew 8.8% from $5.46B, with operating income jumping from $867M to $1.10B and net income from $615M to $782M; trailing net margin sits at 13.2% and operating margin at 18.6%, both multi-year highs. Free cash flow of $972M on only $369M of capex is the standout number—roughly a 16% FCF margin and a clean 4.4% yield at the $22.1B enterprise. Balance-sheet leverage is light (debt/equity 0.27, $1.93B debt against $7.2B equity), current ratio 2.1, and the dividend is comfortably covered at a 31% payout. Quarterly run-rate has stabilized in the $1.46–1.59B band with year-ago comparisons still positive mid-to-high single digits, confirming the business is not collapsing as pandemic-era volumes normalize.
The valuation, however, already capitalizes most of that recovery. At $226.83 the stock trades 28.6× trailing earnings, 15× EV/EBITDA and 3.8× sales while ROIC is only 9.5% and ROE 10.9%. A mature medical-infrastructure compounder growing revenue at a 7.5% CAGR and recent YoY of 8.7% does not ordinarily clear a late-20s earnings multiple unless investors are embedding another leg of margin expansion or acceleration that the quarterly series does not yet show. Revenue confidence is explicitly flagged as decelerating; the 43.8% earnings CAGR is an artifact of the 2023 trough ($107M NI) and will not repeat from today’s $782M base. Insider activity is noise—option exercises and awards with matching sales—so there is no insider endorsement of the current price. The rule-based “mature earner” label and the synthesis fair-value band around $189 are directionally correct: the market is paying for quality and defensibility that is real, but it is paying as if growth will stay elevated.
The strongest counter-argument is that STERIS is a sector-leader compounder with sticky hospital and life-science relationships, high switching costs, and genuine operating leverage still visible in the gross-to-operating margin stack (44% gross, 18.6% operating). Market-forces commentary correctly notes strengthening moats and above-market growth potential; if mid-teens FCF conversion persists and revenue re-accelerates even modestly above 8–9%, a 15× EV/EBITDA multiple is defensible for healthcare infrastructure and the stock can grind higher on multiple stability rather than expansion. Bulls will also note that the $189 composite embeds conservative growth assumptions and that FCF quality plus low leverage give management optionality for bolt-ons that historically have been value-accretive. Those points keep the overvaluation from being egregious—this is not a story stock or a balance-sheet risk—but they do not erase the fact that you are paying 29× for high-single-digit top-line growth and sub-10% ROIC.
I would flip to neutral or constructive only if the next two quarters show revenue re-acceleration above 10% YoY with operating margin holding or expanding past 19%, or if FCF runs sustainably above $1.1B while the multiple compresses toward 22–24× earnings on a pullback into the $190–200 zone. Conversely, a print of flat-to-down organic growth or margin give-back would confirm the deceleration thesis and justify a deeper de-rating.
Big-3 Panel — where each AI stands
Advanced Analysis Forensic deep-dive · separate lenses
STERIS shows a clean fundamental trajectory: revenue up from 4.59B in 2022 to 5.94B in 2026 (roughly 7% CAGR), gross margin steady around 44%, and operating margin expanding from 9.3% to 18.6% over four years. Net income more than tripled (243.9M to 782.3M) and FCF more than doubled (397.2M to 972.4M), with FCF consistently exceeding net income - the 2026 OCF/NI of 3.21x and accruals of -5.1% of assets point to genuine cash earnings, not accounting-driven ones. Beneish M of -2.68 and Altman Z of 5.17 corroborate clean books. Per-share value is protected: diluted shares essentially flat (98.3M to 98.7M), SBC only ~1% of revenue, and buybacks running 3x SBC. Insider tape is neutral - a single small option-exercise-and-sell by Sohi and routine director awards, nothing directional. The one real constraint is the balance sheet: net debt of ~1.49B versus only 439.6M liquid cash. With 972M of annual FCF this is comfortably serviceable, but it means the balance sheet is a working tool, not a cushion, and limits optionality in a downturn.
Verify before trusting this (4)
- Cause of the 2023 operating-margin collapse to 5.4% (impairment, litigation, or M&A-related charge?)
- Debt maturity schedule and covenants behind the 1.49B net debt
- Segment mix and customer concentration in the healthcare/AST/life-sciences lines
- Whether the FCF-to-NI gap reflects sustainable D&A/working capital dynamics or acquisition accounting
The composite fair value of $158.92 and signal-adjusted $189.16 both sit meaningfully below the $226.83 price, implying roughly 17% downside on the blended read. The DCF ($136) and EPV floor ($61) anchor deserved value in the $135-190 range for a business growing mid-single-digits with expanding margins; the anchored-PE output of $302 is the obvious outlier and looks like a runaway multiple extrapolation that I would not lean on. Earnings quality is high, so I do not haircut further, and the Strong business grade justifies pushing deserved value toward the upper end of the sane range - call it ~$190. What is priced in at $227: continued margin expansion, mid-to-high single digit revenue growth, no integration or leverage hiccup, and a premium multiple holding indefinitely. That is a reasonable base case for a durable sterilization franchise, but it leaves essentially zero cushion. This is the classic 'good business, full price' setup - not egregiously overvalued, but you are paying tomorrow's fair value today.
Verify before trusting this (4)
- Forward organic growth guidance vs the mid-to-high single digit path embedded in the DCF
- Segment margin trajectory - is Healthcare margin expansion still running or plateauing
- Any one-off items behind the 2023 margin dip and whether they are truly non-recurring
- Leverage/interest cost trajectory and capital allocation between buybacks and debt paydown
There is no cult story on STE right now. The news flow is anodyne - a Morgan Stanley healthcare conference appearance on Sep 15 and generic 'fairly valued' takes on the stock. That is neutral-to-slightly-constructive: a conference slot is a minor tailwind (management gets a mic, sell-side updates models) but it is not a narrative catalyst. Analyst tone reads as balanced, framing shares as near fair value rather than a screaming buy or a short. The regime backdrop is mixed for this specific name. The tape is nominally risk-on (VIX 14, near highs), which usually does little for a 0.91-beta med-device sterilization name - defensive healthcare underperforms when risk appetite is on. Offsetting that, the 10y at 4.79% and a market PE near 26 press on bond-proxy healthcare compounders like STE. Net: no dominant force, ordinary crosswinds in both directions, and momentum in the stock itself has been quietly positive - which is really the strongest sentiment signal here.
Verify before trusting this (4)
- Tone and any guide-tweak from the Sep 15 Morgan Stanley Healthcare Conference presentation
- Whether sell-side price targets get revised up or down in the week after the conference
- Any move in the 10y yield - a break above 5% would materially press defensive healthcare
- Sector rotation flows: is money leaving med-devices for higher-beta healthcare (biotech, tools) as risk-on builds
The structural demand for sterilization and contamination control is non-discretionary and rises with procedure volumes, aging populations and med-device/biopharma output — a rare healthcare niche insulated from reimbursement deflation because the customer's alternative is regulatory non-compliance. Rate-driven macro headwinds bite the capital-equipment slice and can delay hospital orders, and the regulatory tightening around ethylene oxide is a real capex tax. Nothing in the AI or payer-pressure landscape intermediates STERIS's unit economics: sterilizing an implant remains a physical, licensed, site-specific service with requalification costs measured in years. Net read: a low-drama mid-single-to-high-single-digit compounder in a slowing but structurally growing category, with earnings power growing faster than revenue.
When we made this prediction on Sep 4, 2026, STE was $224.19. We expect it to be $199.00 by Mar 2027, and we consider it great value under $175.00. This is an early model (v0.6.0) — the direction is more reliable than the exact price. Made Sep 4, 2026.
Blue is our prediction, starting the day we made it. Grey is a slower route to the same place — the same destination, taking longer. Black is the actual price, so you can see how we are doing.