Latest Ratios: P/E Ratio 10.0x · EV/EBITDA 7.3x · 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 | $15.3B | $13.9B | $11.5B | — | — | — |
| Enterprise Value | $19.5B | $18.0B | $18.7B | — | — | — |
| P/E Ratio → | 9.95 | 8.92 | 23.93 | — | — | — |
| P/S Ratio | 1.84 | 1.67 | 1.39 | — | — | — |
| P/B Ratio | 3.07 | 2.75 | 3.88 | — | — | — |
| P/FCF | — | — | 14.25 | — | — | — |
| P/OCF | 41.47 | 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 | 7.29 | 6.76 | 11.77 | — | — | — |
| EV / EBIT | 8.92 | 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% | 8.0% | 10.6% | 11.7% |
| 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 | 0.01 | 0.01 |
| Debt / EBITDA | 1.89 | 1.89 | 5.03 | 3.69 | 0.04 | 0.05 |
| Net Debt / Equity | — | 0.82 | 2.45 | 0.70 | 0.00 | 0.00 |
| Net Debt / EBITDA | 1.56 | 1.56 | 4.56 | 3.60 | 0.01 | 0.01 |
| Debt / FCF | — | — | 9.00 | 4.99 | 0.02 | 0.01 |
| 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 | 10.0% | 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 |
Includes 30+ ratios · 5 years · Updated daily
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Quick answers to the most common questions about buying SOLV stock.
Solventum Corporation's current P/E ratio is 10.0x. The historical average is 16.4x. This places it at the 50th percentile of its historical range.
Solventum Corporation's current EV/EBITDA is 7.3x. 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 10.0x. This is at the 50th percentile of its historical P/E range. 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.
Key Metrics
Top Statement Risk
Goodwill impairment and leverage
Metrics are mathematically derived from official filings.
Discounted Multiple Reflects Stagnation
SOLV trades at 9.6x trailing earnings and 7.1x EV/EBITDA, a steep discount to peers like BDX at 30.8x and 13.5x, per reported figures, suggesting the market prices in limited growth and elevated risk.
The forward P/E of 12.1x implies an expected earnings rebound, but the low EV/EBITDA of 7.1x versus the sector's mid-teens suggests the market is skeptical of sustained margin recovery. Given flat revenue and volatile margins, the discount appears justified unless operational leverage materializes. Investors should monitor whether the forward multiple compresses further if cash flow deterioration persists.
Margin Volatility Masks Core Earning Power
Gross margin held at 58.2% in 2026Q2, but operating margin swung from 84.0% to 8.2% in recent quarters, as per financial statements, indicating non-operating distortions obscure the underlying profitability trend.
The 84.0% operating margin in 2025Q4 likely reflects a one-time gain, while the 8.2% in 2026Q2 is more indicative of ongoing operations. Net margin of 4.2% in 2026Q2 is below the 11.8% seen in 2024Q1, suggesting cost pressures and SG&A escalation are eroding profitability. The true earning power appears to be an operating margin in the high single digits, not the double-digit figures occasionally reported.
Return on Capital Remains Subdued
ROIC has hovered between 0.6% and 2.0% over the last ten quarters, with a spike to 14.2% in 2025Q4, as reported in SEC filings, indicating that the company is not consistently compounding returns on invested capital.
The low and volatile ROIC, despite a gross margin above 50%, suggests that operating inefficiencies and a heavy intangible asset base are dragging returns. The 2025Q4 spike likely reflects a non-recurring gain, not sustainable performance. With ROE at 1.9% in 2026Q2, the company is generating returns well below its cost of capital, which may indicate value destruction unless the recent deleveraging improves efficiency.
Working Capital Cycle Lengthens
Cash conversion cycle extended to 87 days in 2026Q2 from 95 days in 2024Q1, as per financial statements, driven by rising DIO to 105 days and stable DSO, indicating slower inventory turnover and reduced cash generation.
Inventory days increased from 84 to 105 over the period, while DPO rose only modestly, causing the CCC to remain elevated. This suggests that working capital is absorbing cash, consistent with the negative FCF margin of -5.8% in 2026Q2. Asset turnover is stagnant at 0.14-0.16, reflecting the asset-heavy goodwill base and limited revenue growth, which may indicate inefficiency in deploying assets.
Leverage Eases but Coverage Remains Thin
Debt-to-equity improved to 1.10 in 2026Q2 from 2.16 in 2024Q1, but interest coverage fell to 2.69x, as reported in financial statements, indicating that debt service is becoming less comfortable despite deleveraging.
Total debt declined to $5.3B, but D/EBITDA spiked to 30.7x in 2026Q2 due to depressed EBITDA, making the leverage ratio misleading. Interest coverage of 2.69x is below the 9.44x seen in 2024Q1, suggesting that operating income is barely covering interest expenses. The company's ability to service debt may be strained if cash flow continues to deteriorate, though the absolute debt reduction provides some cushion.
Liquidity Buffer Thins to Critical Levels
Current ratio fell to 1.02 and quick ratio to 0.74 in 2026Q2, with cash down to $403M, as per balance sheet data, indicating a shrinking liquidity cushion that may be vulnerable under stress.
The quick ratio below 1.0 suggests that current liabilities exceed liquid assets, and the reliance on inventory (DIO of 105 days) may not provide immediate cash if needed. With negative FCF and a declining cash balance, the company may need to rely on external financing or asset sales to meet short-term obligations. This thin liquidity position warrants close monitoring, especially if revenue stagnation persists.
Misapplied EV/EBITDA in a Distressed Context
EV/EBITDA of 7.1x appears cheap, but with D/EBITDA at 30.7x and volatile EBITDA, as per reported figures, this multiple obscures the true leverage and earnings quality, making it a misleading valuation metric.
EBITDA is depressed by one-time items and margin volatility, so the low EV/EBITDA may not reflect normalized earning power. A more appropriate metric would be EV/EBIT or EV/operating cash flow, which better capture the company's cash generation and debt service ability. Investors should adjust for non-recurring gains and use a through-cycle EBITDA to assess whether the discount is warranted or a value trap.