Smith & Nephew plc (SNN) AI Stock Analysis

Smith & Nephew plc develops, manufactures, and markets medical devices worldwide across several clinical areas. Its orthopedics portfolio includes knee implants for replacement procedures, hip implants for joint reconstruction, and trauma and extremities devices for stabilizing fractures and correcting deformities. In sports medicine, the company supplies instruments, implants, and arthroscopic enabling technologies such as fluid management systems, high-definition cameras, and tissue resection tools for minimally invasive joint repair. It also provides advanced wound care solutions, ranging from bioactives and biologics for debridement and dermal repair to regenerative medicine products including skin substitutes and bone grafts.

Revenue rose from $5.21B in FY2021 to $6.16B in FY2025, representing a 5-year revenue CAGR of 6.2% from FY2020 to FY2025. Gross margin contracted from 71.0% in FY2021 to 68.3% in FY2025, while operating margin expanded to 12.9% in FY2025 after touching a low of 7.7% in FY2023. Net income recovered to $625.0M in FY2025 with a net margin of 10.1%, up from $412.0M in FY2024 and $223.0M in FY2022. For the trailing twelve months ended June 30, 2026, revenue stood at $6.30B with an operating margin of 14.5%. In the latest quarter, quarterly revenue grew 4.6% year-over-year and quarterly earnings grew 5.7%.

As of June 30, 2026, Smith & Nephew held $754.0M in cash and short-term investments alongside total debt of $3.79B, resulting in net debt of $3.03B. Shareholders' equity was $5.18B, giving a debt-to-equity ratio of 0.73, while liquidity remained solid with a current ratio of 2.14. Operating cash flow reached $1.28B in FY2025, supporting capital expenditures of $433.0M and free cash flow of $852.0M. During FY2025, the company deployed $502.0M into share buybacks and paid $330.0M in dividends, contributing to a 5-year share count change of -51.0%.

Smith & Nephew trades at a trailing P/E of 19.8x and a forward P/E of 11.2x, below the median of its US-listed Healthcare peers of 24.6x trailing and 17.3x forward. Its enterprise value of $14.56B reflects an EV/EBITDA of 9.3x and an EV/revenue of 2.3x, compared to the peer median EV/EBITDA of 12.0x. Price-to-sales stands at 1.9x against the peer median of 4.1x. The stock recorded a 1-year return of -16.6% and a 5-year return of -5.9%, trailing the S&P 500 (SPY) returns of 16.8% and 83.0% over the same periods.

Smith & Nephew pays a semiannual dividend with an annualized forward payout of $0.79, reflecting a dividend yield of 2.73%. Its payout ratio is 2.1%, and the company has maintained consecutive dividend payments for 27 years. The 5-year annualized dividend growth rate is 0.3%, and the most recent ex-dividend date was October 2, 2026.

Wall Street coverage includes 1 Buy and 5 Hold ratings, with 0 Strong Buy, 0 Sell, and 0 Strong Sell recommendations. The mean price target is $32.32, which is 11.2% above the last closing price of $29.06. For the fiscal year ending December 31, 2026, analysts project revenue of $6.47B and EPS of $2.22, representing 9.0% EPS growth. For the following fiscal year, 4 analysts estimate revenue of $6.80B and EPS of $2.41. The company recorded 0 EPS beats over the last 4 quarters.

This page is an AI-written research summary of Smith & Nephew plc (SNN). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.

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