📊 SHC Key Takeaways
Is Sotera Health Co (SHC) a Good Investment?
Sotera Health Co faces significant financial headwinds including negative free cash flow (-$16.7M), elevated leverage (3.44x debt/equity), and weak capital returns (4.3% ROE) despite operational profitability. The company must address its unsustainable capital expenditure pattern exceeding operating cash flow while managing high debt levels, though adequate liquidity provides near-term runway.
Why Buy Sotera Health Co Stock? SHC Key Strengths
- Strong gross margins (52.5%) and solid operating margins (15.2%) demonstrate operational efficiency
- Steady revenue growth of 5.7% year-over-year shows market traction
- Robust short-term liquidity (2.82x current ratio, 2.54x quick ratio) provides financial flexibility
- Adequate cash reserves of $314.1M provide sufficient operational runway
- Profitable on GAAP basis with 9.5% net margin
SHC Stock Risks: Sotera Health Co Investment Risks
- Negative free cash flow of -$16.7M indicates company burning cash despite accounting profitability
- Highly elevated debt/equity ratio of 3.44x creates significant financial leverage risk
- Poor capital efficiency evidenced by very low ROE (4.3%) and ROA (0.8%)
- Net income flat year-over-year despite revenue growth signals margin compression
- Capital expenditure ($46.2M) significantly exceeds operating cash flow ($29.4M) creating unsustainable spending pattern
- Interest coverage ratio unavailable raises questions about debt servicing adequacy
Key Metrics to Watch
- Free cash flow trajectory - must turn positive to demonstrate financial sustainability
- Debt/Equity ratio - must trend downward to reduce financial leverage
- Operating cash flow growth relative to capex spending - must align for sustainability
- Net income growth rate - must exceed revenue growth to show margin expansion
- Return on Equity and Assets trends - must improve to show better capital deployment
Sotera Health Co (SHC) Financial Metrics & Key Ratios
💡 AI Analyst Insight
Strong liquidity with a 2.82x current ratio provides a solid financial cushion.
SHC Profit Margin, ROE & Profitability Analysis
SHC vs Services Sector: How Sotera Health Co Compares
How Sotera Health Co compares to Services sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Sotera Health Co Stock Overvalued? SHC Valuation Analysis 2026
Based on fundamental analysis, Sotera Health Co shows some fundamental concerns relative to the Services sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Sotera Health Co Balance Sheet: SHC Debt, Cash & Liquidity
SHC Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Sotera Health Co's revenue has grown significantly by 25% over the 5-year period, indicating strong business expansion. The most recent EPS of $0.18 reflects profitable operations.
SHC Revenue Growth, EPS Growth & YoY Performance
SHC Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $254.5M | -$13.3M | $-0.05 |
| Q3 2025 | $285.5M | $17.0M | $0.06 |
| Q2 2025 | $276.6M | -$5.3M | $-0.02 |
| Q1 2025 | $248.2M | N/A | $0.02 |
| Q3 2024 | $263.2M | $12.7M | $0.04 |
| Q2 2024 | $255.3M | $8.8M | $0.03 |
| Q1 2024 | $220.6M | N/A | $0.01 |
| Q3 2023 | $248.7M | $12.7M | $0.04 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Sotera Health Co Dividends, Buybacks & Capital Allocation
SHC SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Sotera Health Co (CIK: 0001822479)
📋 Recent SEC Filings
❓ Frequently Asked Questions about SHC
What is the AI rating for SHC?
Sotera Health Co (SHC) has an AI rating of SELL with 62% confidence, based on fundamental analysis of SEC EDGAR filings.
What are SHC's key strengths?
Claude: Strong gross margins (52.5%) and solid operating margins (15.2%) demonstrate operational efficiency. Steady revenue growth of 5.7% year-over-year shows market traction.
What are the risks of investing in SHC?
Claude: Negative free cash flow of -$16.7M indicates company burning cash despite accounting profitability. Highly elevated debt/equity ratio of 3.44x creates significant financial leverage risk.
What is SHC's revenue and growth?
Sotera Health Co reported revenue of $280.0M.
Does SHC pay dividends?
Sotera Health Co does not currently pay dividends.
Where can I find SHC SEC filings?
Official SEC filings for Sotera Health Co (CIK: 0001822479) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is SHC's EPS?
Sotera Health Co has a diluted EPS of $0.09.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is SHC a good stock to buy right now?
Based on our AI fundamental analysis in May 2026, Sotera Health Co has a SELL rating with 62% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is SHC stock overvalued or undervalued?
Valuation metrics for SHC: ROE of 4.3% (sector avg: 16%), net margin of 9.5% (sector avg: 10%). Compare these metrics with sector averages to assess valuation.
Should I buy SHC stock in 2026?
Our dual AI analysis gives Sotera Health Co a combined SELL rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is SHC's free cash flow?
Sotera Health Co's operating cash flow is $29.4M, with capital expenditures of $46.2M. FCF margin is -6.0%.
How does SHC compare to other Services stocks?
Vs Services sector averages: Net margin 9.5% (avg: 10%), ROE 4.3% (avg: 16%), current ratio 2.82 (avg: 1.5).
Is Sotera Health Co carrying too much debt?
SHC has a debt-to-equity ratio of 3.44x, which is above the Services sector average of 0.7x. However, the current ratio of 2.82 suggests adequate short-term liquidity.