STE Stock Gains on Q2 Earnings and Revenue Beat, '26 EPS View Up

STERIS plc STE reported second-quarter fiscal 2026 adjusted earnings per share (EPS) of $2.47, up 15.4% from the year-ago quarter’s figure. The figure surpassed the Zacks Consensus Estimate by 3.8%.The adjustment excludes the impacts of certain non-recurring charges, such as the amortization of acquired intangible assets and acquisition and integration-related charges.The company’s GAAP EPS was $1.94, up 28.5% from the year-ago level of $1.51.STE’s Q2 Revenues in DetailRevenues of $1.46 billion from continuing operations increased 9.8% year over year. The figure surpassed the Zacks Consensus Estimate by 2.3%.Organic revenues at constant exchange rate or CER rose 9% year over year.Following the earnings announcement, STE stock rose 2% in after-market trading yesterday.STE’s Quarterly Performance in DetailThe company operates under three segments — Healthcare, Applied Sterilization Technologies (“AST”) and Life Sciences.Revenues at Healthcare rose 9% year over year to $1.03 billion (up 9% on a CER organic basis). This reflected a 13% improvement in service revenues, 10% growth in consumable revenues and 4% growth in capital equipment revenues. Our model expected Healthcare segment revenues to improve 5.9% in the fiscal second quarter.Revenues from AST improved 10% to $281.5 million (up 7% on a CER organic basis). This reflected 13% growth in service revenues and a 76% decline in capital equipment revenues. Our model anticipated a 10.8% improvement in the segment’s quarterly revenues.Revenues from the Life Sciences segment increased 13% to $145 million (up 12% year over year on a CER organic basis). This reflected 39% growth in capital equipment revenues, 9% growth in service revenues and 7% growth in consumable revenues. Our model projected a year-over-year increase of 7.2% for the segment’s revenues.MarginsThe gross profit in the reported quarter was $645.9 million, up 11.6% from the prior-year level. The gross margin expanded 68 basis points (bps) year over year to 44.2% despite an 8.6% increase in the cost of revenues.STERIS witnessed a 6.2% year-over-year rise in selling, general and administrative expenses. The figure amounted to $349.7 million. Research and development expenses rose 4.4% to $28.2 million. Adjusted operating expenses totaled $377.9 million, up 6.1% year over year. The adjusted operating margin expanded 161 bps to 18.3%.Financial DetailsSTERIS exited the second quarter of fiscal 2026 with cash and cash equivalents of $319.2 million compared with $279.7 million at the end of the first quarter. Cumulative net cash provided from operating activities at the end of the fiscal second quarter was $707.8 million compared with $554.5 million in the year-ago period. Further, the company has a five-year annualized dividend growth rate of 9.63%.STERIS plc Price, Consensus and EPS Surprise STERIS plc price-consensus-eps-surprise-chart | STERIS plc QuoteGuidanceSTERIS updated its 2026 organic revenue growth and EPS projection.It still expects revenues from continuing operations to increase approximately 8-9%. The Zacks Consensus Estimate is pegged at $5.91 billion, implying 8.3% growth from fiscal 2025.Constant currency organic revenues are now expected to improve approximately 7-8% (earlier 6-7%). Adjusted EPS is now expected to be in the range of $10.15-$10.30 (earlier $9.90-$10.15). The Zacks Consensus Estimate for the metric is pegged at $10.07.Our TakeSTERIS ended second-quarter fiscal 2026 on a solid note, wherein both earnings and revenues beat estimates. All business segments experienced growth during the quarter. The year-over-year top-line growth can be attributed to favorable foreign currency. Meanwhile, the expansion of both margins bodes well for the stock.Furthermore, the raised EPS guidance for fiscal 2026 looks encouraging.STE’s Zacks Rank & Key PicksSTE currently carries a Zacks Rank #4 (Sell).Some better-ranked stocks from the broader medical space are Medpace Holdings MEDP, IDEXX Laboratories IDXX and Boston Scientific BSX.Medpace, currently sporting a Zacks Rank #1 (Strong Buy), reported a third-quarter 2025 EPS of $3.86, which surpassed the Zacks Consensus Estimate by 10.29%. Revenues of $659.9 million beat the Zacks Consensus Estimate by 3.04%. You can see the complete list of today’s Zacks #1 Rank stocks here.MEDP has an estimated earnings growth rate of 17.1% for 2025 compared with the industry’s 16.6% growth. The company beat on earnings in each of the trailing four quarters, the average surprise being 14.28%.IDEXX, carrying a Zacks Rank #2 (Buy) at present, posted a third-quarter 2025 adjusted EPS of $3.40, which exceeded the Zacks Consensus Estimate by 8.3%. Revenues of $1.11 billion topped the Zacks Consensus Estimate by 3.2%.IDXX has an estimated historical earnings growth rate of 14.9% compared with the industry’s 10.1% growth. The company’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 6.08%.Boston Scientific, currently carrying a Zacks Rank #2, reported a third-quarter 2025 adjusted EPS of 75 cents, which surpassed the Zacks Consensus Estimate by 5.6%. Revenues of $5.07 billion topped the Zacks Consensus Estimate by 1.9%.BSX has an estimated long-term earnings growth rate of 16.4% compared with the industry’s 13.5% growth. The company’s earnings beat estimates in each of the trailing four quarters, the average surprise being 7.36%.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Boston Scientific Corporation (BSX): Free Stock Analysis Report IDEXX Laboratories, Inc. (IDXX): Free Stock Analysis Report STERIS plc (STE): Free Stock Analysis Report Medpace Holdings, Inc. (MEDP): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks