Stryker Corporation (SYK) | Investment Case

1. Company Snapshot

1.a. Company Description

Stryker Corporation operates as a medical technology company.The company operates through two segments, MedSurg and Neurotechnology, and Orthopaedics and Spine.The Orthopaedics and Spine segment provides implants for use in hip and knee joint replacements, and trauma and extremities surgeries.

This segment also offers spinal implant products comprising cervical, thoracolumbar, and interbody systems that are used in spinal injury, deformity, and degenerative therapies.The MedSurg and Neurotechnology segment offers surgical equipment and surgical navigation systems, endoscopic and communications systems, patient handling, emergency medical equipment and intensive care disposable products, reprocessed and remanufactured medical devices, and other medical device products that are used in various medical specialties.This segment also provides neurotechnology products, which include products used for minimally invasive endovascular techniques; products for brain and open skull based surgical procedures; orthobiologic and biosurgery products, such as synthetic bone grafts and vertebral augmentation products; minimally invasive products for the treatment of acute ischemic and hemorrhagic stroke; and craniomaxillofacial implant products, including cranial, maxillofacial, and chest wall devices, as well as dural substitutes and sealants.

The company sells its products to doctors, hospitals, and other healthcare facilities through company-owned subsidiaries and branches, as well as third-party dealers and distributors in approximately 75 countries.Stryker Corporation was founded in 1941 and is headquartered in Kalamazoo, Michigan.

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1.b. Last Insights on SYK

The recent 3-month performance of Stryker Corporation was negatively impacted by a decrease in reported earnings per share (EPS) despite strong segmental performance and a rise in operating margin. The company's Q1 2025 results showed reported EPS decreased 17.6% to $1.69, while adjusted EPS increased 13.6% to $2.84. Rising costs likely continued to hurt margins, despite strong organic sales growth of 10.1%. The company's net sales increased 11.9% to $5.9 billion, driven by growth in both MedSurg and Neurotechnology and Orthopaedics segments.

1.c. Company Highlights

Last Price	364.02
Change Percentage	-0.09%
Open	365.51
Previous Close	364.35
Market Cap ( Millions)	139204
Volume	1093383
Year High	406.19
Year Low	329.16
M A 50	368.34
M A 200	377.12

FCF Yield	2.93%
Dividend Yield	0.92%
ROE	13.92%
Debt / Equity	76.18%
Net Debt / EBIDTA	286.12%
Price To Book	6.39
Price Earnings Ratio	47.3
Price To FCF	34.18
Price To sales	5.71
EV / EBITDA	32.72

2. Stryker's Q3 2025 Earnings: Strong Organic Growth and Margin Expansion

Stryker reported a robust third quarter in 2025, with organic sales growth of 9.5% and adjusted EPS growth of 11.1% to $3.19, beating analyst estimates of $3.13. The company's adjusted gross margin expanded by 50 basis points to 65%, driven by business mix and cost improvements. The US organic sales growth was 10.6%, while international sales grew 6.3%. The company's strong financial performance was broad-based across its businesses, with high single-digit growth in MedSurg and Neurotechnology and double-digit growth in Orthopedics.

Publication Date: Nov -01

                                    📋 Highlights
                                    Organic Sales & EPS Growth::
                                                9.5% organic sales growth and 11.1% adjusted EPS growth in Q3 2025.
Full-Year Outlook Raised::
                                                9.8–10.2% organic net sales growth and $13.50–$13.60 adjusted EPS guidance for 2025.
Gross Margin Expansion::
                                                Adjusted gross margin reached 65%, up 50 bps YoY, with 100 bps operating margin expansion expected.
Record Mako Installations::
                                                Best-ever Q3 Mako installations in the US and globally, driven by knee business innovation.
Tariff Impact::
                                                $200M estimated full-year 2025 net impact from tariffs, with ongoing monitoring of the fluid situation.

                                

Business Highlights

The company's Mako installations were a highlight, with Stryker delivering its best-ever Q3 for Mako installations in the US and worldwide. The Inari integration is progressing well, with double-digit pro forma organic sales growth in the quarter. Stryker's Knee business is poised for high growth, driven by new product innovations, including Mako, which had a record installation quarter.

Guidance and Outlook

Stryker raised its full-year 2025 outlook, expecting organic net sales growth of 9.8% to 10.2% and adjusted EPS of $13.50 to $13.60. The company expects continued strength in procedural volumes through the end of the year and anticipates a strong finish to 2025. Tariff headwinds are estimated to have a net impact of approximately $200 million for the full year 2025.

Valuation and Growth Prospects

With a P/E Ratio of 46.29 and an EV/EBITDA of 31.7, Stryker's valuation multiples suggest that the market is pricing in significant growth prospects. Analysts estimate next year's revenue growth at 8.5%. The company's strong track record of innovation and its expanding portfolio through acquisitions, such as Guard Medical, position it well for continued growth. As Stryker updates its long-term financial goals at its upcoming Investor Day, investors will be looking for further guidance on its growth trajectory.

Operational Strengths and Challenges

Stryker's ASC business is growing rapidly, with a strong position in knees and opportunities to leverage its portfolio across business lines. However, the Medical business had a weaker quarter due to supply chain disruptions, but a rebound is expected in Q4. The company's focus on margin expansion and its ability to maintain momentum in 2025 will be key to its continued success. As Jason Beach noted, Stryker believes it has pricing power across all its businesses due to its execution and innovation.

3. NewsRoom

Stryker names Spencer Stiles President and Chief Operating Officer

Dec -04

Source: globenewswire.com

BLI Banque de Luxembourg Investments Lowers Position in Stryker Corporation $SYK

Dec -01

Source: defenseworld.net

Boston Family Office LLC Purchases 1,882 Shares of Stryker Corporation $SYK

Dec -01

Source: defenseworld.net

Clarkston Capital Partners LLC Acquires 500 Shares of Stryker Corporation $SYK

Nov -28

Source: defenseworld.net

Baltimore Washington Financial Advisors Inc. Has $29.38 Million Stock Holdings in Stryker Corporation $SYK

Nov -27

Source: defenseworld.net

Why Are Insiders Are Dumping Shares of Robinhood, Stryker, and Mercury Systems?

Nov -25

Source: marketbeat.com

Associated Banc Corp Has $9.13 Million Holdings in Stryker Corporation $SYK

Nov -25

Source: defenseworld.net

AlphaCore Capital LLC Buys 470 Shares of Stryker Corporation $SYK

Nov -25

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.90%)

6. Segments

Medsurg and Neurotechnology

Expected Growth: 8.5%

Stryker's Medsurg and Neurotechnology segment growth of 8.5% is driven by increasing demand for minimally invasive surgical procedures, expanding applications of robotic-assisted surgery, and rising adoption of advanced neurosurgical technologies. Strong sales of robotic systems, navigation systems, and implants also contribute to this growth.

Orthopaedics

Expected Growth: 9.5%

Stryker's Orthopaedics segment growth of 9.5% is driven by increasing demand for joint replacement procedures, expanding portfolio of innovative products, and strategic acquisitions. The segment's strong performance is also attributed to the company's focus on robotics and digital solutions, which enhance surgical efficiency and patient outcomes.

7. Detailed Products

Orthopaedic Implants

Stryker's Orthopaedic Implants segment offers a range of products, including hip, knee, and trauma implants, as well as bone cement and accessories.

MedSurg Equipment

Stryker's MedSurg Equipment segment provides a variety of medical devices, including hospital beds, stretchers, and surgical navigation systems.

Neurotechnology and Spine

Stryker's Neurotechnology and Spine segment offers products for neurosurgery, orthobiologics, and spinal implant systems.

Instruments

Stryker's Instruments segment provides a range of surgical instruments, including electrosurgical, endoscopic, and orthopaedic instruments.

8. Stryker Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Stryker Corporation operates in the medical technology industry, where substitutes are limited. However, the company faces competition from alternative medical procedures and treatments, which could potentially substitute its products.

Bargaining Power Of Customers

Stryker Corporation sells its products to hospitals, clinics, and other healthcare providers, which have limited bargaining power due to the specialized nature of the company's products.

Bargaining Power Of Suppliers

Stryker Corporation relies on a diverse range of suppliers for raw materials, components, and services. While some suppliers may have bargaining power, the company's diversified supply chain mitigates this risk.

Threat Of New Entrants

The medical technology industry has high barriers to entry, including significant research and development costs, regulatory hurdles, and the need for specialized expertise. This limits the threat of new entrants.

Intensity Of Rivalry

The medical technology industry is highly competitive, with several established players competing for market share. Stryker Corporation faces intense rivalry from companies such as Johnson & Johnson, Medtronic, and Zimmer Biomet.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	41.14%
Debt Cost	3.95%
Equity Weight	58.86%
Equity Cost	8.51%
WACC	6.63%
Leverage	69.89%

11. Quality Control: Stryker Corporation passed 5 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

J&J

A-Score: 6.4/10

Value: 3.0

Growth: 4.0

Quality: 7.7

Yield: 6.0

Momentum: 8.0

Volatility: 10.0

1-Year Total Return ->

Abbott

A-Score: 6.2/10

Value: 2.7

Growth: 5.9

Quality: 7.8

Yield: 4.0

Momentum: 7.0

Volatility: 9.7

1-Year Total Return ->

Stryker

A-Score: 5.3/10

Value: 1.8

Growth: 6.4

Quality: 6.7

Yield: 2.0

Momentum: 5.0

Volatility: 10.0

1-Year Total Return ->

Boston Scientific

A-Score: 5.1/10

Value: 0.9

Growth: 6.6

Quality: 6.7

Yield: 0.0

Momentum: 6.5

Volatility: 9.7

1-Year Total Return ->

Regeneron Pharmaceuticals

A-Score: 4.2/10

Value: 4.2

Growth: 6.4

Quality: 8.6

Yield: 0.0

Momentum: 0.5

Volatility: 5.7

1-Year Total Return ->

DexCom

A-Score: 4.1/10

Value: 1.0

Growth: 9.1

Quality: 6.4

Yield: 0.0

Momentum: 4.0

Volatility: 4.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

8.98%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

6.63%

Stryker Corporation - US8636671013

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on SYK

1.c. Company Highlights

Less Volatile

Expensive

Better Quality

Earnings Beats

Revenues Beats

Average Yield

Average Quality

Higher Yield

2. Stryker's Q3 2025 Earnings: Strong Organic Growth and Margin Expansion

Business Highlights

Guidance and Outlook

Valuation and Growth Prospects

Operational Strengths and Challenges

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.90%)

6. Segments

Medsurg and Neurotechnology

Expected Growth: 8.5%

Orthopaedics

Expected Growth: 9.5%

7. Detailed Products

Orthopaedic Implants

MedSurg Equipment

Neurotechnology and Spine

Instruments

8. Stryker Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Stryker Corporation passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

364.02$

Current Price

364.02$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA