Latest Ratios: P/E Ratio 8.6x · EV/EBITDA 6.5x · ROE 38.9%. (2021–2025 historical series)
Price-based multiples — how expensive the stock is relative to earnings, sales, book value, and cash flow
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 |
|---|---|---|---|---|---|---|
| Market Cap | $13.2B | $13.9B | $11.5B | — | — | — |
| Enterprise Value | $17.4B | $18.0B | $18.7B | — | — | — |
| P/E Ratio → | 8.59 | 8.92 | 23.93 | — | — | — |
| P/S Ratio | 1.59 | 1.67 | 1.39 | — | — | — |
| P/B Ratio | 2.65 | 2.75 | 3.88 | — | — | — |
| P/FCF | — | — | 14.25 | — | — | — |
| P/OCF | 35.80 | 37.64 | 9.68 | — | — | — |
P/E links to full P/E history page with 30-year chart
Enterprise-value multiples — capital-structure-neutral measures of total business value
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 |
|---|---|---|---|---|---|---|
| EV / Revenue | — | 2.17 | 2.27 | — | — | — |
| EV / EBITDA | 6.50 | 6.76 | 11.77 | — | — | — |
| EV / EBIT | 7.96 | 8.76 | 19.26 | — | — | — |
| EV / FCF | — | — | 23.26 | — | — | — |
Margins and return-on-capital ratios measuring operating efficiency
Full margin charts and quarterly trend are on the Earnings History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 |
|---|---|---|---|---|---|---|
| Gross Margin | 53.5% | 53.5% | 55.6% | 57.3% | 57.7% | 60.2% |
| Operating Margin | 26.2% | 26.2% | 12.6% | 20.6% | 20.8% | 23.0% |
| Net Profit Margin | 18.7% | 18.7% | 5.8% | 16.4% | 16.5% | 17.9% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 |
|---|---|---|---|---|---|---|
| ROE | 38.9% | 38.9% | 6.6% | 11.5% | 11.3% | 12.1% |
| ROA | 10.8% | 10.8% | 3.4% | 9.8% | 9.7% | 10.4% |
| ROIC | 16.9% | 16.9% | 5.2% | 8.1% | 10.7% | 11.8% |
| ROCE | 19.0% | 19.0% | 8.6% | 13.8% | 13.6% | 14.8% |
Solvency and debt-coverage ratios — lower is generally safer
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 |
|---|---|---|---|---|---|---|
| Debt / Equity | 1.00 | 1.00 | 2.71 | 0.71 | — | — |
| Debt / EBITDA | 1.89 | 1.89 | 5.03 | 3.69 | — | — |
| Net Debt / Equity | — | 0.82 | 2.45 | 0.70 | -0.01 | -0.01 |
| Net Debt / EBITDA | 1.56 | 1.56 | 4.56 | 3.60 | -0.03 | -0.04 |
| Debt / FCF | — | — | 9.00 | 4.99 | -0.04 | -0.05 |
| Interest Coverage | 5.94 | 5.94 | 2.65 | — | — | — |
Short-term solvency ratios and asset-utilisation metrics
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 |
|---|---|---|---|---|---|---|
| Current Ratio | 1.23 | 1.23 | 1.20 | 1.46 | 1.70 | 1.56 |
| Quick Ratio | 0.89 | 0.89 | 0.84 | 0.96 | 1.04 | 0.98 |
| Cash Ratio | 0.28 | 0.28 | 0.28 | 0.11 | 0.05 | 0.06 |
| Asset Turnover | — | 0.58 | 0.57 | 0.59 | 0.60 | 0.58 |
| Inventory Turnover | 3.63 | 3.63 | 3.79 | 4.09 | 3.93 | 4.00 |
| Days Sales Outstanding | — | 45.33 | 54.35 | 58.47 | 52.57 | 52.58 |
Earnings, FCF, buyback, and dividend yields — total returns to shareholders
Full dividend history and growth charts are on the Dividend History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 |
|---|---|---|---|---|---|---|
| Dividend Yield | — | — | — | — | — | — |
| Payout Ratio | — | — | — | — | — | — |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 |
|---|---|---|---|---|---|---|
| Earnings Yield | 11.6% | 11.2% | 4.2% | — | — | — |
| FCF Yield | — | — | 7.0% | — | — | — |
| Buyback Yield | 0.0% | 0.0% | 0.0% | — | — | — |
| Total Shareholder Yield | 0.0% | 0.0% | 0.0% | — | — | — |
| Shares Outstanding | — | $175M | $174M | $173M | $172M | $172M |
Standalone Operational Overhead
As reported in recent financial data, Solventum trades at a TTM P/E of 8.96, which, when compared to peers like Becton Dickinson at 26.74, suggests the market is pricing in significant long-term stagnation rather than the potential for a successful turnaround as an independent entity.
The current valuation multiples appear to reflect a deep discount, likely driven by the company's recent revenue contraction and the uncertainty surrounding its standalone cost structure. Investors should monitor whether the forward P/E of 12.15 indicates a valuation floor or if the market requires further evidence of margin stabilization before re-rating the stock.
Based on quarterly filings, Solventum's ROIC has plummeted from 2.0% in 2023Q4 to a marginal 0.6% in 2026Q1, indicating that the company is currently failing to generate meaningful returns on its invested capital following the separation from its parent organization's infrastructure.
The sharp decline in ROIC suggests that the capital base is not being deployed effectively to drive growth or operational efficiency. This trend warrants further investigation into whether the current asset base is bloated by legacy spin-off costs or if the core business segments are suffering from structural underperformance.
According to the latest financial statements, the cash conversion cycle has fluctuated significantly, reaching 85 days in 2026Q1, which highlights a persistent inability to optimize the timing between inventory procurement and the collection of receivables from hospital and clinical customers.
The high days inventory outstanding, which stood at 107 days in 2026Q1, suggests that the company may be holding excessive stock or facing slower turnover in its MedSurg and Purification segments. This inefficiency ties up critical liquidity and may be contributing to the observed volatility in free cash flow.
As indicated by the most recent quarterly reports, the interest coverage ratio has compressed to 1.31 in 2026Q1, a significant deterioration from the levels observed in previous periods, which suggests that the company's ability to service its debt is becoming increasingly constrained by declining operating income.
While the debt-to-equity ratio of 1.02 appears manageable in isolation, the narrowing interest coverage ratio indicates that the company has little room for error in its operational performance. Investors should monitor whether management will need to prioritize debt reduction over reinvestment to maintain its credit profile.
The P/E ratio is frequently misapplied to Solventum because it fails to account for the non-recurring separation costs and transition service agreement expenses that currently distort the company's net income, thereby masking the underlying earning power of its core healthcare segments.
Analysts should instead focus on EV/EBITDA or adjusted free cash flow metrics to better understand the company's operational health. Relying on P/E in the current environment may lead to an inaccurate assessment of the company's value, as it ignores the significant accounting noise inherent in a recent spin-off.
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Quick answers to the most common questions about buying SOLV stock.
Solventum Corporation's current P/E ratio is 8.6x. The historical average is 16.4x.
Solventum Corporation's current EV/EBITDA is 6.5x. This enterprise value multiple compares the company's total value (equity + debt - cash) to its EBITDA. The historical average is 9.3x.
Solventum Corporation's return on equity (ROE) is 38.9%. This is above the typical threshold of 15-20% considered good for most companies. The historical average is 16.1%.
Based on historical data, Solventum Corporation is trading at a P/E of 8.6x. Compare with industry peers and growth rates for a complete picture.
Solventum Corporation has 53.5% gross margin and 26.2% operating margin. Operating margin above 20% indicates strong pricing power and cost efficiency.
Solventum Corporation's Debt/EBITDA ratio is 1.9x, indicating moderate leverage. A ratio below 2x is generally considered financially healthy.