Solventum Corporation Fundamental Analysis (NYSE: SOLV)
Solventum Corporation Fundamental Analysis (NYSE: SOLV)
Solventum Corporation (NYSE: SOLV) shows weak financial fundamentals with a PE ratio of 99.79, profit margin of 1.91%, and ROE of 3.18%. The company generates $8.1B in annual revenue with weak year-over-year growth of 0.86%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 19.7/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze SOLV's fundamental strength across five key dimensions:
Efficiency Score
WeakSOLV struggles to generate sufficient returns from assets.
Valuation Score
ModerateSOLV shows balanced valuation metrics.
Growth Score
WeakSOLV faces weak or negative growth trends.
Financial Health Score
ModerateSOLV shows balanced financial health with some risks.
Profitability Score
WeakSOLV struggles to sustain strong margins.
Key Financial Metrics
Is SOLV Expensive or Cheap?
P/E Ratio
SOLV trades at 99.79 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, SOLV's PEG of -1.11 indicates potential undervaluation.
Price to Book
The market values Solventum Corporation at 3.16 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 12.82 times EBITDA. This signals the market has high growth expectations.
How Well Does SOLV Make Money?
Net Profit Margin
For every $100 in sales, Solventum Corporation keeps $1.91 as profit after all expenses.
Operating Margin
Core operations generate 24.60 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $3.18 in profit for every $100 of shareholder equity.
ROA
Solventum Corporation generates $1.10 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Solventum Corporation generates limited operating cash flow of $310.46M, signaling weaker underlying cash strength.
Free Cash Flow
Solventum Corporation generates weak or negative free cash flow of $1.99M, restricting financial flexibility.
FCF Per Share
Each share generates $0.01 in free cash annually.
FCF Yield
SOLV converts 0.01% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
99.79
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-1.11
vs 25 benchmark
P/B Ratio
Price to book value ratio
3.16
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.85
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
1.10
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.03
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.03
vs 25 benchmark
ROA
Return on assets percentage
0.01
vs 25 benchmark
ROCE
Return on capital employed
0.19
vs 25 benchmark
How SOLV Stacks Against Its Sector Peers
| Metric | SOLV Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 99.79 | 31.30 | Worse (Expensive) |
| ROE | 3.18% | 487.00% | Weak |
| Net Margin | 1.91% | -1832.00% (disorted) | Weak |
| Debt/Equity | 1.10 | 0.10 | Weak (High Leverage) |
| Current Ratio | 1.03 | 5.74 | Neutral |
| ROA | 1.10% | -165.00% (disorted) | Weak |
SOLV outperforms its industry in 0 out of 6 key metrics, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Solventum Corporation's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
13.27%
Industry Style: Defensive, Growth, Innovation
High GrowthEPS CAGR
35.45%
Industry Style: Defensive, Growth, Innovation
High GrowthFCF CAGR
-81.96%
Industry Style: Defensive, Growth, Innovation
Declining