DCF Studio

    SYK · NYQ · Healthcare

    Stryker Corporation

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 216.62

    Market price

    USD 306.81

    Implied upside

    -29.4%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    Current EV/EBITDA of 20.6x sits outside a defensible 3-20x band, so the exit multiple is capped at 20.0x. A multiple that far out usually means EBITDA is the wrong denominator for this business.

    Value Per Share

    Perpetuity growth
    USD 216.62-29.4%
    Exit multiple
    USD 332.12+8.2%
    Market price
    USD 306.81

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn3bn6bnFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 26.8bnUSD 29.3bnUSD 31.7bnUSD 34.0bnUSD 36.3bnUSD 38.4bnUSD 40.3bnUSD 42.0bnUSD 43.4bnUSD 44.5bn+5.8%
    EBITUSD 5.1bnUSD 5.6bnUSD 6.1bnUSD 6.5bnUSD 7.0bnUSD 7.4bnUSD 7.7bnUSD 8.1bnUSD 8.3bnUSD 8.5bn+5.8%
    NOPATUSD 4.4bnUSD 4.8bnUSD 5.2bnUSD 5.6bnUSD 6.0bnUSD 6.3bnUSD 6.6bnUSD 6.9bnUSD 7.2bnUSD 7.3bn+5.8%
    Add depreciation & amortisationUSD 1.3bnUSD 1.4bnUSD 1.6bnUSD 1.7bnUSD 1.8bnUSD 1.9bnUSD 2.0bnUSD 2.1bnUSD 2.1bnUSD 2.2bn+5.8%
    Less capital expenditureUSD -828.7mUSD -1.0bnUSD -1.2bnUSD -1.4bnUSD -1.6bnUSD -1.9bnUSD -2.1bnUSD -2.3bnUSD -2.6bnUSD -2.8bn+14.4%
    Capex, % of revenue3.1%3.4%3.8%4.1%4.5%4.8%5.2%5.5%5.9%6.3%-
    Less increase in working capitalUSD -548.0mUSD -788.8mUSD -782.6mUSD -762.8mUSD -728.9mUSD -680.4mUSD -617.5mUSD -540.7mUSD -451.2mUSD -350.5m-4.8%
    Free cashflow to firmUSD 4.4bnUSD 4.5bnUSD 4.8bnUSD 5.1bnUSD 5.4bnUSD 5.7bnUSD 5.9bnUSD 6.1bnUSD 6.3bnUSD 6.4bn+4.3%
    Discount factor0.96210.89060.82440.76320.70640.65390.60530.56030.51870.4802-
    Present valueUSD 4.2bnUSD 4.0bnUSD 4.0bnUSD 3.9bnUSD 3.8bnUSD 3.7bnUSD 3.6bnUSD 3.4bnUSD 3.3bnUSD 3.1bn-
    Present Value Of The ForecastUSD 37.0bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta0.849Reported 0.774, pulled toward 1.0 (Blume)
    Cost of equity8.48%Risk-free + beta x equity risk premium
    Cost of debt5.44%Risk-free + 55bp, the spread for a AA rating at 8.3x interest cover. Book interest / average debt was lower, at 4.1%.
    Market capitalisationUSD 116.8bn88.0% of capital
    Total debtUSD 15.9bn12.0% of capital, book value as a proxy
    Tax rate14.1%Effective, capped at statutory
    WACC8.03%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 216.62

    61% of EV

    Forecast FCFF, final year
    USD 6.4bn
    Capex at depreciation, working capital in reinvestment
    USD 8.5bn
    Less reinvestment at g/ROIC (22.7% of NOPAT)
    USD -1.9bn
    Capitalised
    USD 6.6bn
    ROIC (reported)
    11.0%
    Terminal value, undiscounted
    USD 121.8bn
    Terminal value, discounted
    USD 58.5bn
    Enterprise value
    USD 95.5bn
    Less net debt
    USD 11.8bn
    Equity value
    USD 83.7bn

    Exit at 20.0x EBITDA

    Value per shareUSD 332.12

    74% of EV

    Terminal value, undiscounted
    USD 214.7bn
    Terminal value, discounted
    USD 103.1bn
    Enterprise value
    USD 140.1bn
    Less net debt
    USD 11.8bn
    Equity value
    USD 128.4bn

    Spread between methods: 42%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    6.03%324.47338.61357.45383.32420.38
    7.03%258.22263.95271.45281.38294.79
    8.03%212.42214.17216.63220.01224.61
    9.03%178.91178.64178.65179.00179.79
    10.03%153.35152.03150.80149.68148.68

    Outlined: this model. Green text: above today's price of 306.81. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year10.8%5.9%9.9%
    EBIT margin20.7%19.2%26.9%
    Discount rate-8.0%6.6%
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.