
Sotera Health (SHC) Stock Forecast & Price Target
Sotera Health (SHC) Analyst Ratings
Bulls say
Sotera Health is projected to experience a compound annual growth rate of adjusted EBITDA between 5% and 8% through 2027, indicating potential margin expansion of 50 to 150 basis points. The company is also expected to achieve an additional 90 basis points of adjusted EBITDA margin improvement from its Sterigenics business from 2025 to 2028, while maintaining stable margins for its Nordion and Nelson Labs segments. With a strategic shift towards higher-margin lab testing services and a successful initial execution of its cross-selling strategy, Sotera is well-positioned for adjusted gross profit growth at a compound annual rate of 6.4%, reflecting ongoing operational efficiencies and increased market penetration.
Bears say
Sotera Health has experienced a decline in adjusted EBITDA margins, dropping 180 basis points from 51.7% in 2021 to 49.9% in 2024, primarily due to inflation, overstaffing, and a negative mix within its Nelson Labs segment. The company's earnings outlook is further compounded by a significant reduction in sales from higher-margin COVID-related testing and poor performance in advisory services, which is projected to adversely affect Nelson Labs sales by 10 points in 2025. Additionally, despite prior organic revenue growth of 9.0% from 2021 to 2022, ongoing customer supply chain issues and a strategic shift toward lower-margin services have led to increased financial pressure on the firm.
This aggregate rating is based on analysts' research of Sotera Health and is not a guaranteed prediction by Public.com or investment advice.
Sotera Health (SHC) Analyst Forecast & Price Prediction
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