Common Stock Valuation Ratios (Price Multiples)
Valuation ratios measure the quantity of an asset or flaw (e.g., earnings) associated with ownership of a specified claim (e.g., a share of ownership of the enterprise).
Current Valuation Ratios
Stryker Corp., current price multiples
| Stryker Corp. | Abbott Laboratories | CVS Health Corp. | Elevance Health Inc. | Intuitive Surgical Inc. | Medtronic PLC | UnitedHealth Group Inc. | Health Care Equipment & Services | Health Care | ||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||||||||
| Current share price (P) | $241.26 | |||||||||||
| No. shares of common stock outstanding | 378,154,080 | |||||||||||
| Growth rate (g) | 6.99% | |||||||||||
| Earnings per share (EPS) | $5.27 | |||||||||||
| Next year expected EPS | $5.64 | |||||||||||
| Operating profit per share | $6.83 | |||||||||||
| Sales per share | $45.24 | |||||||||||
| Book value per share (BVPS) | $39.34 | |||||||||||
| Valuation Ratios (Price Multiples) | ||||||||||||
| Price to earnings (P/E) | 45.75 | 17.14 | 17.65 | 12.85 | 79.70 | 24.66 | 18.93 | 21.99 | 22.90 | |||
| Price to next year expected earnings | 42.77 | 15.59 | 16.89 | 11.46 | 70.52 | 24.28 | 16.46 | 20.08 | 20.99 | |||
| Price-earnings-growth (PEG) | 6.55 | 1.73 | 3.96 | 1.06 | 6.12 | 15.76 | 1.26 | 2.30 | 2.53 | |||
| Price to operating profit (P/OP) | 35.31 | 33.66 | 9.56 | 10.55 | 78.80 | 19.31 | 8.45 | 16.30 | 18.95 | |||
| Price to sales (P/S) | 5.33 | 5.48 | 0.22 | 0.44 | 22.16 | 3.43 | 0.69 | 1.21 | 2.84 | |||
| Price to book value (P/BV) | 6.13 | 4.82 | 1.08 | 1.86 | 11.26 | 2.39 | 2.94 | 3.41 | 5.44 | |||
Based on: 10-K (reporting date: 2021-12-31).
If the company price multiple is lower then the price multiple of benchmark then company stock is relatively undervalued.
Otherwise, if the company price multiple is higher then the price multiple of benchmark then company stock is relatively overvalued.
Historical Valuation Ratios (Summary)
Stryker Corp., historical price multiples
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
- Price to Earnings (P/E) Ratio
- The P/E ratio exhibited significant variability over the analyzed period. It started at a high level of 54.36 in 2017, then dipped sharply to 18.96 in 2018. Following this decline, the ratio increased substantially to 39.24 in 2019 and peaked at 57.72 in 2020. In 2021, the P/E ratio decreased moderately to 47.65. This fluctuation indicates pronounced changes in the market's valuation relative to earnings, suggesting periods of both heightened investor optimism and reassessment of earnings prospects.
- Price to Operating Profit (P/OP) Ratio
- The P/OP ratio demonstrated a general upward trend from 2017 to 2020, moving from 24.21 to a peak of 41.52. However, in 2021, the ratio declined to 36.77, indicating a slight correction. Overall, this pattern suggests increasing investor willingness to pay for operating profit over the four-year span, with a minor reduction afterward, possibly reflecting changes in operating profitability or market sentiment.
- Price to Sales (P/S) Ratio
- This ratio showed a steadily increasing trend from 4.46 in 2017 to 6.43 in 2020, highlighting growing market valuation relative to sales. In 2021, the ratio decreased to 5.55, indicating some moderation but remaining above initial levels. This pattern suggests sustained sales growth or enhanced market confidence in sales performance over the years, with a slight adjustment in the last period.
- Price to Book Value (P/BV) Ratio
- The P/BV ratio increased steadily from 5.56 in 2017 to 7.05 in 2020, reflecting rising valuations relative to the company's book value. In 2021, it declined to 6.39, indicating a slight pullback. The overall trend points to an appreciation of the company's net assets as perceived by the market, with some correction in the final year analyzed.
Price to Earnings (P/E)
Stryker Corp., historical P/E calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 377,544,686 | 376,200,942 | 374,575,145 | 372,664,636 | 374,642,060 | |
| Selected Financial Data (US$) | ||||||
| Net earnings (in millions) | 1,994) | 1,599) | 2,083) | 3,553) | 1,020) | |
| Earnings per share (EPS)2 | 5.28 | 4.25 | 5.56 | 9.53 | 2.72 | |
| Share price1, 3 | 251.65 | 245.34 | 218.24 | 180.75 | 148.01 | |
| Valuation Ratio | ||||||
| P/E ratio4 | 47.65 | 57.72 | 39.24 | 18.96 | 54.36 | |
| Benchmarks | ||||||
| P/E Ratio, Competitors5 | ||||||
| Abbott Laboratories | 29.13 | 48.49 | — | — | — | |
| CVS Health Corp. | 17.39 | 12.88 | — | — | — | |
| Elevance Health Inc. | 18.13 | 15.87 | — | — | — | |
| Intuitive Surgical Inc. | 59.94 | 87.47 | — | — | — | |
| Medtronic PLC | 46.56 | 26.30 | — | — | — | |
| UnitedHealth Group Inc. | 26.03 | 20.54 | — | — | — | |
| P/E Ratio, Sector | ||||||
| Health Care Equipment & Services | 26.88 | 24.48 | — | — | — | |
| P/E Ratio, Industry | ||||||
| Health Care | 21.35 | 30.75 | — | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 Data adjusted for splits and stock dividends.
2 2021 Calculation
EPS = Net earnings ÷ No. shares of common stock outstanding
= 1,994,000,000 ÷ 377,544,686 = 5.28
3 Closing price as at the filing date of Stryker Corp. Annual Report.
4 2021 Calculation
P/E ratio = Share price ÷ EPS
= 251.65 ÷ 5.28 = 47.65
5 Click competitor name to see calculations.
- Share Price
- The share price exhibited a consistent upward trend over the five-year period, increasing from $148.01 in 2017 to $251.65 in 2021. This growth reflects a positive perception of the company's value in the market, with the most significant absolute increase occurring between 2018 and 2019.
- Earnings Per Share (EPS)
- EPS showed notable volatility throughout the years. There was a sharp increase from $2.72 in 2017 to $9.53 in 2018, followed by a decline to $5.56 in 2019 and a further decrease to $4.25 in 2020. In 2021, EPS partially recovered to $5.28 but remained well below the peak reached in 2018. This fluctuation suggests variability in the company’s profitability before and after 2018.
- Price-to-Earnings Ratio (P/E)
- The P/E ratio fluctuated significantly, decreasing sharply from 54.36 in 2017 to 18.96 in 2018, which aligns with the EPS peak in 2018 causing valuation adjustments. Following this, the P/E ratio rose again to 39.24 in 2019 and further to 57.72 in 2020, indicating high market valuation relative to earnings during periods of lower EPS. In 2021, the P/E ratio declined to 47.65 but remained elevated, reflecting continued investor confidence despite moderate earnings levels.
- Overall Interpretation
- The data reveals a pattern of strong market valuation supported by rising share prices, contrasted with fluctuating profitability levels as reflected in EPS. The inverse relationship observed between EPS and P/E ratio in certain years suggests that market optimism and valuation were not always proportionate to earnings performance. The significant EPS peak in 2018 followed by declines indicates a period of exceptional earnings followed by normalization or challenges impacting profitability. Despite these earnings variations, the upward trend in share price and generally high P/E ratios point to sustained investor confidence in the company’s future prospects.
Price to Operating Profit (P/OP)
Stryker Corp., historical P/OP calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 377,544,686 | 376,200,942 | 374,575,145 | 372,664,636 | 374,642,060 | |
| Selected Financial Data (US$) | ||||||
| Operating income (in millions) | 2,584) | 2,223) | 2,713) | 2,537) | 2,290) | |
| Operating profit per share2 | 6.84 | 5.91 | 7.24 | 6.81 | 6.11 | |
| Share price1, 3 | 251.65 | 245.34 | 218.24 | 180.75 | 148.01 | |
| Valuation Ratio | ||||||
| P/OP ratio4 | 36.77 | 41.52 | 30.13 | 26.55 | 24.21 | |
| Benchmarks | ||||||
| P/OP Ratio, Competitors5 | ||||||
| Abbott Laboratories | 24.45 | 40.69 | — | — | — | |
| CVS Health Corp. | 10.43 | 6.65 | — | — | — | |
| Elevance Health Inc. | 15.70 | 12.10 | — | — | — | |
| Intuitive Surgical Inc. | 56.11 | 88.37 | — | — | — | |
| Medtronic PLC | 37.44 | 26.29 | — | — | — | |
| UnitedHealth Group Inc. | 18.77 | 14.12 | — | — | — | |
| P/OP Ratio, Sector | ||||||
| Health Care Equipment & Services | 19.92 | 17.16 | — | — | — | |
| P/OP Ratio, Industry | ||||||
| Health Care | 17.67 | 22.32 | — | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 Data adjusted for splits and stock dividends.
2 2021 Calculation
Operating profit per share = Operating income ÷ No. shares of common stock outstanding
= 2,584,000,000 ÷ 377,544,686 = 6.84
3 Closing price as at the filing date of Stryker Corp. Annual Report.
4 2021 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= 251.65 ÷ 6.84 = 36.77
5 Click competitor name to see calculations.
- Share Price Trend
- The share price demonstrates a consistent upward trend over the five-year period, increasing from $148.01 at the end of 2017 to $251.65 by the end of 2021. This represents a significant increase of approximately 70%, indicating positive market valuation growth.
- Operating Profit Per Share Trend
- Operating profit per share shows moderate fluctuations. Starting at $6.11 in 2017, it increased to $7.24 in 2019, suggesting improved profitability during the initial years. However, there is a notable decline to $5.91 in 2020, followed by a recovery to $6.84 in 2021. This indicates some volatility, possibly reflective of operational challenges or external factors impacting earnings in 2020.
- Price to Operating Profit Ratio (P/OP)
- The price to operating profit ratio exhibits a rising pattern from 24.21 in 2017 to a peak of 41.52 in 2020, before decreasing to 36.77 in 2021. The increase up to 2020 suggests growing investor optimism or higher expectations of future profit growth relative to the operating profit per share. The subsequent decline in 2021 may reflect a revaluation or adjustment in market expectations despite the recovery in operating profit per share.
- Overall Insights
- Market valuation, as reflected by the share price, has grown steadily, outpacing the growth in operating profit per share. The divergence between the share price and operating profit per share, particularly the sharp rise in the P/OP ratio through 2020, suggests increasing investor confidence or speculative interest during that period. The partial correction in the P/OP ratio in 2021 aligns with the rebound in operating profit per share, indicating a possible realignment of market valuation with underlying operational performance.
Price to Sales (P/S)
Stryker Corp., historical P/S calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 377,544,686 | 376,200,942 | 374,575,145 | 372,664,636 | 374,642,060 | |
| Selected Financial Data (US$) | ||||||
| Net sales (in millions) | 17,108) | 14,351) | 14,884) | 13,601) | 12,444) | |
| Sales per share2 | 45.31 | 38.15 | 39.74 | 36.50 | 33.22 | |
| Share price1, 3 | 251.65 | 245.34 | 218.24 | 180.75 | 148.01 | |
| Valuation Ratio | ||||||
| P/S ratio4 | 5.55 | 6.43 | 5.49 | 4.95 | 4.46 | |
| Benchmarks | ||||||
| P/S Ratio, Competitors5 | ||||||
| Abbott Laboratories | 4.78 | 6.30 | — | — | — | |
| CVS Health Corp. | 0.47 | 0.35 | — | — | — | |
| Elevance Health Inc. | 0.81 | 0.60 | — | — | — | |
| Intuitive Surgical Inc. | 17.89 | 21.29 | — | — | — | |
| Medtronic PLC | 5.57 | 4.36 | — | — | — | |
| UnitedHealth Group Inc. | 1.58 | 1.24 | — | — | — | |
| P/S Ratio, Sector | ||||||
| Health Care Equipment & Services | 1.48 | 1.29 | — | — | — | |
| P/S Ratio, Industry | ||||||
| Health Care | 2.65 | 2.59 | — | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 Data adjusted for splits and stock dividends.
2 2021 Calculation
Sales per share = Net sales ÷ No. shares of common stock outstanding
= 17,108,000,000 ÷ 377,544,686 = 45.31
3 Closing price as at the filing date of Stryker Corp. Annual Report.
4 2021 Calculation
P/S ratio = Share price ÷ Sales per share
= 251.65 ÷ 45.31 = 5.55
5 Click competitor name to see calculations.
- Share Price
- The share price demonstrated a consistent upward trend over the five-year period. Starting at $148.01 in 2017, it rose steadily to $251.65 by the end of 2021. The most significant annual increase occurred between 2018 and 2019, with continued growth observed in subsequent years, although the rate of increase slightly moderated from 2020 to 2021.
- Sales per Share
- Sales per share showed generally positive growth with fluctuations. The value increased from $33.22 in 2017 to $45.31 in 2021. Notably, there was a decline in 2020, dropping from $39.74 in 2019 to $38.15, before recovering sharply in 2021. This suggests a possible temporary setback in sales during 2020, followed by robust recovery.
- Price to Sales (P/S) Ratio
- The P/S ratio increased from 4.46 in 2017 to a peak of 6.43 in 2020, indicating that the market valuation relative to sales was rising even when sales per share declined in 2020. In 2021, the ratio decreased to 5.55, reflecting a recalibration of market expectations despite the rise in sales per share. Overall, this suggests volatility in market valuation versus sales, with a peak valuation multiple in 2020.
- Overall Observations
- The data reveals strong market confidence as reflected in the rising share price throughout the period. Sales per share growth was positive but exhibited a temporary dip in 2020, which may correspond to external challenges during that year. The P/S ratio’s peak in 2020 followed by a decrease in 2021 indicates changing investor sentiment, possibly reassessing the company’s pricing relative to sales after the temporary sales decline. The recovery in sales per share and moderation of the P/S ratio in 2021 suggest a return to fundamentals after 2020’s volatility.
Price to Book Value (P/BV)
Stryker Corp., historical P/BV calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 377,544,686 | 376,200,942 | 374,575,145 | 372,664,636 | 374,642,060 | |
| Selected Financial Data (US$) | ||||||
| Total Stryker shareholders’ equity (in millions) | 14,877) | 13,084) | 12,807) | 11,730) | 9,966) | |
| Book value per share (BVPS)2 | 39.40 | 34.78 | 34.19 | 31.48 | 26.60 | |
| Share price1, 3 | 251.65 | 245.34 | 218.24 | 180.75 | 148.01 | |
| Valuation Ratio | ||||||
| P/BV ratio4 | 6.39 | 7.05 | 6.38 | 5.74 | 5.56 | |
| Benchmarks | ||||||
| P/BV Ratio, Competitors5 | ||||||
| Abbott Laboratories | 5.75 | 6.65 | — | — | — | |
| CVS Health Corp. | 1.83 | 1.33 | — | — | — | |
| Elevance Health Inc. | 3.07 | 2.19 | — | — | — | |
| Intuitive Surgical Inc. | 8.59 | 9.53 | — | — | — | |
| Medtronic PLC | 3.26 | 2.48 | — | — | — | |
| UnitedHealth Group Inc. | 6.27 | 4.83 | — | — | — | |
| P/BV Ratio, Sector | ||||||
| Health Care Equipment & Services | 4.16 | 3.51 | — | — | — | |
| P/BV Ratio, Industry | ||||||
| Health Care | 5.07 | 4.90 | — | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 Data adjusted for splits and stock dividends.
2 2021 Calculation
BVPS = Total Stryker shareholders’ equity ÷ No. shares of common stock outstanding
= 14,877,000,000 ÷ 377,544,686 = 39.40
3 Closing price as at the filing date of Stryker Corp. Annual Report.
4 2021 Calculation
P/BV ratio = Share price ÷ BVPS
= 251.65 ÷ 39.40 = 6.39
5 Click competitor name to see calculations.
- Share Price
- The share price demonstrated a consistent upward trend over the five-year period. Starting at $148.01 in 2017, the share price increased annually, reaching $180.75 in 2018, $218.24 in 2019, and $245.34 in 2020, before slightly moderating growth to $251.65 in 2021. This reflects a strong appreciation in market value with the most notable increments occurring in the earlier years.
- Book Value Per Share (BVPS)
- The book value per share showed a steady increase from $26.60 in 2017 to $39.40 in 2021. The growth was gradual each year: from $26.60 to $31.48 in 2018, then to $34.19 in 2019, $34.78 in 2020, and finally $39.40 in 2021. The increase indicates enhancement in the company’s net asset value on a per-share basis, suggesting an accumulation of equity over the period.
- Price-to-Book Value Ratio (P/BV)
- The P/BV ratio experienced an overall upward movement with some fluctuations. In 2017, the ratio stood at 5.56, rising steadily to 5.74 in 2018 and peaking at 7.05 in 2020. However, there was a decline to 6.39 in 2021. This pattern suggests that the market valuation relative to the book value increased, reaching its highest premium in 2020 before a partial rollback in the subsequent year. This could imply changing investor perceptions about future growth prospects or risk during these years.