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On Friday, Citizens JMP analyst David Turkaly adjusted the price target for STERIS (NYSE: STE) stock, raising it to $280 from the previous $265, while reaffirming a Market Outperform rating. Turkaly provided insights following the company’s fourth-quarter fiscal year 2025 earnings call, which took place the day before. The stock has shown remarkable momentum, gaining over 9% in the past week and trading near its 52-week high of $248.68. InvestingPro analysis indicates the stock is currently fairly valued, with 12 additional exclusive insights available to subscribers.
Turkaly’s decision to raise the price target came after a review and update of their financial model for STERIS, in light of the recent earnings call. The analyst emphasized the company’s solid performance, noting a slight beat on revenue and approximately 5% growth in the bottom line for the quarter. According to InvestingPro data, STERIS maintains a "GREAT" overall financial health score, with particularly strong marks in profitability and price momentum. The company has achieved a notable 20.41% return year-to-date, demonstrating robust market performance.
STERIS concluded the fiscal year with robust results, achieving mid-single-digit sales growth at 6% year-over-year on a constant currency basis, and a notable 12% increase in earnings per share year-over-year. According to Turkaly, these outcomes align with STERIS’s historical growth pattern.
The analyst attributed the company’s success to effective execution across various fronts, including advantageous pricing, a favorable product mix, productivity improvements, and reduced interest expenses resulting from balance sheet deleveraging. These factors collectively outweighed several challenges faced during the year, such as the divestiture of the dental segment and rising input costs.
Turkaly’s comments highlight STERIS’s ability to surpass significant headwinds and maintain its trajectory of growth. The updated price target reflects the analyst’s confidence in the company’s continued performance and market position.
In other recent news, STERIS plc reported a strong performance for the fourth quarter of fiscal year 2025, surpassing earnings expectations. The company posted an earnings per share (EPS) of $2.74, exceeding the forecasted $2.60, while revenue met expectations at $1.48 billion. STERIS also reported a record free cash flow of $787 million for fiscal 2025. Looking ahead, the company anticipates revenue growth of 6-7% for fiscal year 2026, with an EPS guidance range of $9.90 to $10.15, reflecting a 7-10% increase. Additionally, STERIS plans to capture $20 million in restructuring cost savings and manage $30 million in anticipated tariff costs. The company expects EBIT margins to improve by 20 basis points and plans for an effective tax rate of 23.5%. Analysts have not provided any recent upgrades or downgrades, but firms such as Citizens and Needham and Company have engaged with the company regarding their strategic plans and market positioning. These developments reflect STERIS’s ongoing efforts to navigate market challenges and capitalize on growth opportunities.
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