Siemens Healthineers: Weak Q3-22 results, optimistic outlook
«Dieser Inhalt ist nur auf Englisch verfügbar – This content is available in English only»
Report
- Q3-22 revenues of EUR 5.2bn inline with expectations
- Q3-22 gross profit of EUR 1.87bn below expectations (EUR 2bn)
- Q3-22 EBITDA of EUR 938mn below expectations (EUR 983mn)
- Q3-22 adjusted operating income of EUR 765 clear below expectations (EUR 841mn)
- Q3-22 operating margin of 11.45% below expectations (12.4%)
- Q3-22 free cashflow of EUR 478mn below expectations (EUR 619mn)
- Adjusted diluted EPS of EUR 0.43 below expectations (EUR 0.49)
Valuation
Siemens Healthineers currently trades at 20.9x P/E 23E, below its 5-year historical average of 22x and above the MSCI Europe Health Care Index (16.1x). On an EV/EBITDA basis, the stock is trading at 15.1x, above its 5-year average of 13.9x and above the MSCI Europe Health Care Index (11.8x).
Conclusion
Siemens Healthineers experienced stronger headwinds than anticipated. Supply-chain disruptions and several lockdowns in China weighted on results from different angles. The company expects part of missed sales to get executed during next quarters and hence sticks to its given guidance. As well, necessary price adjustments to follow cost pressures will last throughout the next 18 months. Apart from pandemic related challenges and a weaker economic environment, overall operations had been solid.
We reiterate our buy recommendation.
Management Outlook
Siemens Healthineers reiterated its FY-22 guidance for comparable revenue growth of around 7.5% and adjusted basic earnings of EUR ~2.35 per share at group level.
Financials
| Fiscal year 2022* | Fiscal year 2023* | Fiscal year 2024* | |
|---|---|---|---|
| Revenue in mn | 21,057 | 21,684 | 23,085 |
| Revenue growth (%) | 17.9 | 3.0 | 6.5 |
| Net Income in mn | 2,546 | 2,667 | 3,018 |
| Adjusted EPS | 2.27 | 2.37 | 2.69 |
| Profit margin (%) | 12.1 | 12.3 | 13.1 |
| Return on equity (%) | 14.6 | 14.3 | 15.3 |
| P/E ratio (x) | 21.9 | 20.9 | 18.4 |
| P/S ratio (x) | 2.7 | 2.6 | 2.4 |
| P/B ratio (x) | 3.2 | 3.0 | 2.8 |
| Dividend Yield (%) | 2.0 | 2.2 | 2.5 |
Stock and Price Data
| Country | Market Cap in bn | ISIN | Sector | Price | Small Cap |
|---|---|---|---|---|---|
| Germany | EUR 55.9 | DE000SHL1006 | Health Care | EUR 49.53 | No |
Performance
Performance in %
| Since inception* | YTD | Last 6 months |
|---|---|---|
| 47.00 | -23.6 | -13.6 |
VP Bank Sustainability Score
Very good
VP Bank Sustainability Score
3
ESG Score
4
ESG-Momentum
4
Business practices
3
Business activity
4
SDG/Impact ScoreVP Bank AG
CIO Office — Group Equity & Bond Selection
Aeulestrasse 6, 9490 Vaduz, Liechtenstein
T +423 235 63 99
cio-office@vpbank.com
Prices per previous day close. Sources for charts and stats:, Bloomberg, VP Bank
Selected Information ©2022 MSCI ESG Research LLC. Reproduced by permission.
Further information regarding the methodology and indicators: www.vpbank.com/glossary
 |
VP Bank Sustainability Score: Our overall score expresses a comprehensive assessment of a company's sustainability. It is composed of the ESG rating, momentum, business practices and activities. The scale ranges from “insufficient”, "below average", “average”, “good”, "very good" to "excellent". |
 |
ESG rating: The ESG rating reflects how sustainable a company is in terms of environmental, social and governance criteria. The indicators may vary depending on the industry. The scale ranges from -1 ("insufficient") to 5 ("excellent"). |
 |
Momentum: The momentum indicator measures the extent to which the ESG rating of a company has changed. The scale ranges from 1 ("below average") to 5 ("excellent"). |
 |
Business practices: The business practices of a company are analysed and checked whether it is in breach of international standards. Exemplary companies receive a high score, while misdemeanours lead to a low score depending on the severity of the breach. Serious violations lead to exclusion. The scale ranges from -1 ("questionable") to 5 ("exemplary"). |
 |
Business activities: This value scores the business areas in which a company is active. Activities which we consider "critical" are excluded, while borderline and questionable areas receive a deduction. Activities that are not "critical" receive a positive assessment. The scale ranges from -1 ("insufficient") to 5 ("excellent"). |
 |
SDG and Impact Score: This value compares a company's products and activities or dedicated impact solutions with the UN's 17 Sustainable Development Goals (SDGs) and measures the extent to which they contribute to or contradict the achievement of the goals. The scale ranges from 1 ("below average") to 5 ("excellent"). |
A detailed explanation of our methodology can be found here: www.vpbank.com/sustainabilityscore
This document was produced by VP Bank AG (hereinafter: the Bank) and distributed by the companies of VP Bank Group. This document does not constitute an offer or an invitation to buy or sell financial instruments. The recommendations, assessments and statements it contains represent the personal opinions of the VP Bank AG analyst concerned as at the publication date stated in the document and may be changed at any time without advance notice. This document is based on information derived from sources that are believed to be reliable. Although the utmost care has been taken in producing this document and the assessments it contains, no warranty or guarantee can be given that its contents are entirely accurate and complete. In particular, the information in this document may not include all relevant information regarding the financial instruments referred to herein or their issuers.
Additional important information on the risks associated with the financial instruments described in this document, on the characteristics of VP Bank Group, on the treatment of conflicts of interest in connection with these financial instruments and on the distribution of this document can be found at https://www.vpbank.com/en/legal_notice
Liechtenstein: VP Bank AG, 9490 Vaduz · info@vpbank.com
Schweiz: VP Bank (Schweiz) AG, 8001 Zurich · info.ch@vpbank.com
Luxembourg: VP Bank (Luxembourg) SA, 2540 Luxembourg · info.lu@vpbank.com
Singapore: VP Bank Ltd Singapore Branch, 018960 Singapore · info.sg@vpbank.com
British Virgin Islands: VP Bank (BVI) Ltd, Tortola VG1110 · info.bvi@vpbank.com