SYK Hits Key Support – Is This The Buying Opportunity?
Stryker (SYK) should be on your watchlist. Here is why – it is currently trading in the support zone ($359.59 – $397.45), levels from which it has bounced meaningfully before. In the last 10 years, the stock received buying interest at this level 3 times and subsequently went on to generate 10.4% in average peak returns.
| Peak Return | Days to Peak Return | |
|---|---|---|
| 9/18/2024 | 8.8% | 72 |
| 12/31/2024 | 11.1% | 27 |
| 4/9/2025 | 11.4% | 107 |
But is the price action enough alone? It certainly helps if the fundamentals check out. For SYK Read Buy or Sell SYK Stock to see how convincing this buy opportunity might be.
Here are some quick data points:
- Revenue Growth: 10.8% LTM and 10.0% last 3 year average.
- Cash Generation: Nearly 15.4% free cash flow margin and 19.7% operating margin LTM.
- Recent Revenue Shocks: The minnimum annual revenue growth in last 3 years for SYK was 8.7%.
- Valuation: SYK trades at a PE multiple of 52.4
- Opportunity vs S&P: Compared to S&P, you get higher valuation, higher revenue growth, and better margins
Stryker provides surgical equipment, navigation systems, patient care products, and implants for hip, knee, trauma, and extremities surgeries through MedSurg and Orthopaedics segments.
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| SYK | S&P Median | |
|---|---|---|
| Sector | Health Care | – |
| Industry | Health Care Equipment | – |
| PE Ratio | 52.4 | 23.5 |
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| LTM* Revenue Growth | 10.8% | 5.0% |
| 3Y Average Annual Revenue Growth | 10.0% | 5.8% |
| Min Annual Revenue Growth Last 3Y | 8.7% | -0.3% |
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| LTM* Operating Margin | 19.7% | 18.8% |
| 3Y Average Operating Margin | 19.1% | 17.7% |
| LTM* Free Cash Flow Margin | 15.4% | 13.2% |
*LTM: Last Twelve Months
That is one way to look at stocks. Trefis High Quality Portfolio evaluates much more, and is designed to reduce stock-specific risk while giving upside exposure
What Is Stock-Specific Risk If The Market Crashes?
Stryker hasn’t been immune to big sell-offs either. It fell 59% in the Global Financial Crisis and about 36% during the Dot-Com bubble. The Covid pandemic triggered a 44% dip, while the Inflation Shock put it down around 32%. Even the 2018 correction dragged it nearly 19% lower. Solid fundamentals matter, but when markets turn, even strong stocks can take a serious hit.
But the risk is not limited to major market crashes. Stocks fall even when markets are in good shape – think events like earnings, business updates, outlook changes. Read SYK Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.
The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.