SYK

SYK

Stryker Corporation

Hybrid Industrial

★ Quality 74/100
Overvalued

Price today

$303.13

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charlieapp.co

What this business is made of

74qualityReturnsMoatBalance sheetPricing powerReinvestment

The business

Mako is the Gillette of the operating room: give away the razor, sell the blades.

Stryker makes medical devices: orthopedic implants (hip, knee), surgical equipment, neurotechnology and hospital beds. It earns by selling hardware to hospitals and, increasingly, recurring instruments and consumables around its Mako surgical robot. Revenue 2025: $25.1B with a 64% gross margin.

The Mako robot creates real switching costs: once the hospital and surgeon adopt it, Stryker's implants and consumables sell themselves. The relationship with the surgeon, trained on their system, is hard to break. Not a monopoly, but the installed base and the brand carry weight.

Revenue history

$17.1B
2021
$18.4B
2022
$20.5B
2023
$22.6B
2024
$25.1B
2025
CAGR 5 años: +10%

From $17.1B to $25.1B in 4 years. The business grows steadily.

Where each $100 of sales goes

Revenue $25.1B · FY2025

Cost of sales$9.1B · 36%
Operations$11.2B · 45%
Taxes and other$1.6B · 7%
Net profit$3.2B · 13%

Of every $100 in sales, $87 goes to costs and operations; $13 is left as net profit (13% margin).

Catalysts and risks

Expansion of Mako's installed base: every robot placed drags along years of recurring high-margin implants.

Demographic growth: an aging population structurally lifts the volume of hip and knee surgeries through 2030+.

FCF of $4.3B in 2025 funds bolt-on acquisitions, the company's historical growth engine.

⚠️

Debt of $14.9B against cash of $4.0B; the appetite for acquisitions has a limit if rates rise.

⚠️

Pricing pressure from hospitals and insurers on devices, squeezing the 64% margin.

⚠️

Direct competition from Medtronic, J&J and Zimmer in every category; no product is irreplaceable.

Charlie's note

An honest business selling picks and shovels to a population that keeps aging. At 18 times FCF they aren't giving anything away; you pay for quality at a fair price, which is fine if you have patience.

Analysis · June 2026

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