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Smith & Nephew PLC ADR SNN Stock Quote

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Morningstar‘s Stock Analysis SNN

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Smith & Nephew Faces Price Pressure; Giving a Slight Haircut to Our Fair Value Estimate

Debbie S. Wang Senior Equity Analyst

Analyst Note

| Debbie S. Wang |

Smith & Nephew posted second-quarter results that displayed sequential softness following relatively strong performance in first quarter, and we’re modestly lowering our fair value estimate to $38 per ADR (GBX 1,567 per share) after trimming our margin expectations for 2022 and 2023. Nonetheless, we think the market reaction to management’s lower outlook is exaggerated. The firm remains on track to meet our estimates for flat top-line growth in 2022, and our primary adjustments involved tweaking expenses for the next 24 months. Though we remain confident in the firm’s narrow moat, management’s comments about the challenges in its orthopedics business underscores the negative moat trend we’ve given Smith & Nephew.

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Key Statistics SNN

Company Profile SNN

Business Description

Smith & Nephew designs, manufactures, and markets orthopedic devices, sports medicine and arthroscopic technologies, and wound-care solutions. Roughly 42% of the U.K.-based firm's revenue comes from orthopedic products, and another 30% is sports medicine and ENT. The remaining 28% of revenue is from the advanced wound therapy segment. Roughly half of Smith & Nephew's total revenue comes from the United States, just over 30% is from other developed markets, and emerging markets account for the remainder.

Hatters Lane, Building 5, Croxley Park
Watford, Hertfordshire, WD18 8YE, United Kingdom
T +44 1923477100
Industry Medical Devices
Most Recent Earnings Dec 31, 2014
Fiscal Year End Dec 31, 2022
Stock Type
Employees 18,000

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