Steris PLC

Steris has been identified as a company with rising earnings estimates and falling valuations, which presents a compelling investment opportunity. The manager notes that Steris, along with other holdings, is a 'good' business with an obvious moat, suggesting it has competitive advantages that allow it to outgrow GDP. This aligns with the broader strategy of investing in quality companies that are currently undervalued due to market conditions. The manager's confidence in Steris is reflected in their decision to add to the position during a time when many quality businesses are trading at reasonable prices.

STERIS is listed as a core long position in the portfolio, but there is no specific argument or directional language provided regarding its future performance or valuation.

STERIS is a leader in infection prevention, sterilization, and procedural solutions for healthcare providers, hospitals, pharmaceutical & bioprocess customers, and medical-device makers. Despite an overall economically defensive model with ~75% of sales from service and consumables, Steris has historically delivered high single-digit % organic growth and been active in M&A. Valuation is reasonable at 22x 2026 EPS (in line with medium-term history) and the balance sheet is strong at 1x net leverage. Long-term secular tailwinds from an aging global population and continued innovation in healthcare procedures and devices/technology should be continued drivers of growth going forward.

Steris has been a strong performer in our portfolio, benefiting from the resolution of a liability lawsuit that had previously weighed on the company’s long-term growth projections. This resolution provides a clearer path for growth, reinforcing our belief in Steris as a high-quality investment in the health care sector. The company continues to demonstrate resilience and potential for future growth, making it an attractive addition to our strategy.