Assessing CONMED (CNMD) Valuation After Recent Share Price Stabilisation

CONMED (CNMD) has recently drawn investor attention after its share price moved roughly 7% over the past month, set against a backdrop of mixed longer term returns and reported growth in revenue and net income.

See our latest analysis for CONMED.

That recent 7% 1 month share price return sits against a weaker picture over longer periods, with the latest close at $43.40 and multi year total shareholder returns still deeply negative. This suggests sentiment is stabilising but not yet fully repaired.

If CONMED’s recent move has you reassessing your watchlist, this can be a useful moment to scan other healthcare names using our healthcare stocks and compare business quality and price behaviour side by side.

With the shares still well below multiyear highs yet trading at a reported 40% discount to one intrinsic value estimate, the key question now is whether CONMED is mispriced or if the market already reflects its future growth.

Most Popular Narrative: 10.3% Undervalued

With CONMED last closing at $43.40 against a narrative fair value of $48.40, the current gap comes down to how you view its future earnings power and profit margins.

Analysts are assuming CONMED's revenue will grow by 5.7% annually over the next 3 years.

Analysts assume that profit margins will increase from 8.3% today to 9.8% in 3 years time.

Read the complete narrative.

Curious what type of earnings curve and profit profile could support that valuation uplift, even with a lower future P/E and slightly softer growth assumptions? The full narrative lays out a very specific path for revenue, margins and earnings per share that you can compare against your own expectations.

Result: Fair Value of $48.40 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, that story could change fast if supply chain issues linger in orthopedics or if hospital capital budgets tighten, which would pressure both revenue and margin expectations.

Find out about the key risks to this CONMED narrative.

Build Your Own CONMED Narrative

If you look at the same numbers and reach a different conclusion, or simply want to stress test the assumptions yourself, you can build and adjust a custom CONMED view in just a few minutes using Do it your way.

A great starting point for your CONMED research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.

Looking for more investment ideas?

If CONMED has sharpened your thinking, do not stop here. Widening your opportunity set across different themes can help you spot ideas that suit your style.

• Target potential bargains by scanning these 884 undervalued stocks based on cash flows where prices and cash flow expectations may be out of sync.
• Explore developments in machine learning and automation by checking out these 26 AI penny stocks focused on companies building products around these tools.
• Consider opportunities for long term income by reviewing these 12 dividend stocks with yields > 3% that offer yields above 3% supported by underlying businesses you can assess in detail.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com