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ConvaTec Group PLC CTEC

Morningstar Rating
GBX 254.00 +2.20 (0.87%)
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Company Report

Convatec Earnings: Year-to-Date Growth as Expected as Firm Renews Focus on Wound Care Clinical Data

Narrow-moat Convatec’s top-line growth through the first four months of 2024 held few surprises and puts the firm on track to meet our mid-single-digit growth estimate for the full year. We’re holding steady on our fair value estimate. Year to date, the firm has delivered 5% revenue growth across most product segments, consistent with our projections. Thanks to improvements made over the last several years, Convatec has begun to lean into its moaty businesses, ramping up both sales growth and margin gains.

Price vs Fair Value

CTEC is trading at a 243% premium.
Price
GBX 251.80
Fair Value
GBX 712.00
Uncertainty
Medium
1-Star Price
GBX 815.14
5-Star Price
GBX 865.30
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Convatec's well-established footprint in the U.S. ostomy market has paved the way to forge contracts with large group purchasing organizations, including Premier and Vizient.

Bears

Considering that ostomy patients tend to be brand loyal after the first year postdischarge, we expect Convatec's ostomy business to grow gradually as it takes greater share of new patient discharges.

Is it the right time to buy, sell, or hold?
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News

Trading Information

Previous Close Price
GBX 251.80
Day Range
GBX 250.40255.80
52-Week Range
GBX 2.48295.20
Bid/Ask
GBX 230.00 / GBX 300.00
Market Cap
GBX 520.65 Bil
Volume/Avg
2.8 Mil / 7.7 Mil

Key Statistics

Price/Earnings (Normalized)
21.65
Price/Sales
3.00
Dividend Yield (Trailing)
1.94%
Dividend Yield (Forward)
1.94%
Total Yield
1.94%

Company Profile

Originally spun out of Bristol-Myers Squibb, Convatec designs, manufactures, and markets advanced wound care, ostomy, continence care, and infusion sets for the acute-care hospital and chronic-care home settings. Advanced wound care and ostomy supplies are the largest divisions, accounting for 33% and 29% of total revenue, respectively. Continence care has become a slightly smaller business (21% of revenue) following the decision to exit the acute care market, and infusion sets contribute 17% of consolidated revenue.
Sector
Healthcare
Industry
Medical Instruments & Supplies
Stock Style Box
Mid Core
Total Number of Employees
10,136

Competitors

Valuation

Metric
CTEC
SNN
BDX
Price/Earnings (Normalized)
21.6514.2919.22
Price/Book Value
3.882.182.65
Price/Sales
3.002.053.47
Price/Cash Flow
17.2012.0819.16
Price/Earnings
CTEC
SNN
BDX

Financial Strength

Metric
CTEC
SNN
BDX
Quick Ratio
0.790.670.46
Current Ratio
1.621.771.08
Interest Coverage
3.212.844.17
Quick Ratio
CTEC
SNN
BDX

Profitability

Metric
CTEC
SNN
BDX
Return on Assets (Normalized)
7.44%7.27%3.59%
Return on Equity (Normalized)
16.69%13.79%7.46%
Return on Invested Capital (Normalized)
10.90%9.92%5.23%
Return on Assets
CTEC
SNN
BDX
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