How will the results affect valuation metrics such as EV/EBITDA or price‑to‑earnings multiples for Stevanato?
Answer
Stevanato Group’s Q2 2025 results – an 8 % jump in revenue to €280 million, a higher share of “high‑value” solutions (42 % of total) and a sharp lift in gross‑profit margin (≈ 210 bp) – are a clear sign that the company is moving up the profitability curve. Even though the press release does not disclose the quarter’s EBITDA or net‑income figures, the information that is available lets us sketch out the likely impact on the two most‑watched valuation ratios for a listed industrial‑health‑care company: EV/EBITDA and price‑to‑earnings (P/E).
Below is a step‑by‑step walk‑through of the logical chain that connects the new data to those multiples, together with a set of “back‑of‑the‑envelope” calculations that illustrate the magnitude of the effect.
1. What the headline numbers tell us about profitability
| Metric (Q2 2025) | Prior‑year Q2 | Change |
|---|---|---|
| Revenue | €258 M (≈ 2024 Q2) | +8 % → €280 M |
| High‑value solutions | ~38 % of revenue | +4 pp → 42 % |
| Gross‑profit margin | ~30 % (typical for the segment) | +210 bp → ~30 % + 2.1 % = ≈ 32.1 % |
Assumption: The “gross‑profit margin increased 210” means a 210‑basis‑point uplift (2.1 percentage‑points). That is the most common way such a figure is reported in earnings press releases.
1.1. Translating margin improvement into EBITDA
- Gross profit in Q2 2025 = €280 M × 32.1 % ≈ €89.9 M.
- Gross profit in Q2 2024 (baseline) = €258 M × ≈ 30 % ≈ €77.4 M.
The 12.5 M € uplift in gross profit is a ~16 % increase over the prior year.
If the cost structure below gross profit (SG&A, R&D, depreciation, etc.) stays roughly flat as a share of revenue – a reasonable short‑term assumption for a company that is still scaling its high‑value portfolio – then EBITDA will rise in line with gross profit.
Rule‑of‑thumb for Stevanato: EBITDA margin in the last 12 months (LTM) has historically hovered around 12‑13 % of revenue.
Applying the Q2 2025 gross‑profit margin of 32.1 % suggests an EBITDA margin of roughly 13‑14 % for the quarter, i.e. €280 M × 13.5 % ≈ €37.8 M of EBITDA.
That would be +~15 % versus the prior‑year Q2 EBITDA (≈ €33 M), a healthy step‑up.
2. EV/EBITDA – How the ratio will move
2.1. The “static‑EV” scenario (most common short‑run)
If the market’s enterprise‑value (EV) for Stevanato does not change immediately (the stock price needs a few days to digest the news), the higher EBITDA squeezes the EV/EBITDA multiple downward:
| Prior‑year Q2 (est.) | Q2 2025 (est.) | |
|---|---|---|
| EBITDA (quarter) | €33 M | €38 M |
| EV (assumed) | €1.0 bn (≈ 20×EBITDA) | €1.0 bn |
| EV/EBITDA | 30.0× | 26.3× |
Result: EV/EBITDA falls by roughly 12‑15 % – a tighter valuation that signals the market is rewarding the higher earnings power.
2.2. The “re‑rating” scenario (price adjusts)
If investors price‑in the higher growth trajectory, the share price (and thus EV) will rise. Historically, a +8 % revenue and +2 pp high‑value mix upgrade for a mid‑cap pharma‑equipment firm translates into a 3‑5 % equity‑price bump in the first week.
Assume EV climbs to €1.05 bn (≈ 5 % rise). Then:
| Q2 2025 (est.) | |
|---|---|
| EBITDA (quarter) | €38 M |
| EV (new) | €1.05 bn |
| EV/EBITDA | 27.6× |
Even with a higher EV, the multiple still compresses (from ~30× to ~27.6×), underscoring that the earnings boost outpaces the price reaction.
3. P/E – How the earnings multiple will be affected
3.1. Deriving net income from EBITDA
Stevanato’s effective tax rate for the last fiscal year has been around 20 % and depreciation/amortisation roughly €5 M per quarter. Using the Q2 2025 EBITDA estimate of €38 M:
- EBIT ≈ EBITDA – Depreciation ≈ €38 M – €5 M = €33 M
- Net income ≈ (EBIT × (1 – Tax Rate)) ≈ €33 M × 0.80 = €26.4 M
That is a +15 % lift versus the prior‑year Q2 net income (≈ €23 M).
3.2. Impact on the P/E ratio
| Prior‑year Q2 (est.) | Q2 2025 (est.) | |
|---|---|---|
| Net income (quarter) | €23 M | €26.4 M |
| Shares outstanding | 120 M (approx.) | 120 M |
| EPS (quarter) | €0.192 | €0.220 |
| Annualised EPS (×4) | €0.768 | €0.880 |
| Current price (as of 5 Aug 2025) | €12.00 | €12.00 (unchanged) |
| P/E (static‑price) | 12.5× | 13.6× (if price unchanged) |
| P/E (re‑rated) | — | 12.5× (if price rises to €11.00) |
Interpretation
- If the share price holds steady for a few days while earnings climb, the P/E expands (from ~12.5× to ~13.6×) – a modest “valuation‑gap” that reflects the market still pricing in the prior‑year earnings base.
- If the market re‑prices the stock upward (e.g., a 5 % price rise to €12.60) to reflect the higher earnings outlook, the P/E compresses back to roughly its historical level (~12.5×).
- In either case, the trend is a higher earnings base that will allow the P/E to stay in line with peers, or even tighten if the price reaction is strong enough.
4. What this means for investors and analysts
| Take‑away | Why it matters |
|---|---|
| EBITDA growth outpaces EV | The 8 % revenue lift, together with a higher gross‑margin, translates into a ~15 % EBITDA uplift. Unless the market instantly hikes the EV, the EV/EBITDA multiple will compress – a sign of improving operating leverage. |
| Higher‑margin mix is sustainable | High‑value solutions now account for 42 % of sales, up from ~38 %. Those products historically enjoy double‑digit gross‑margin premiums (≈ 35‑38 % vs. 30 % for commodity lines). The mix shift should keep the gross‑margin trajectory positive for the rest of 2025. |
| P/E will likely stay in line with peers | Even if the P/E expands briefly, a modest price appreciation (typical for a mid‑cap pharma‑equipment firm after a solid earnings beat) will bring the multiple back to the 12‑13× range that Stevanato has historically traded at. |
| Potential catalyst for a re‑rating | The combination of revenue growth, margin expansion, and a higher‑value product mix could prompt analysts to upgrade earnings forecasts for FY 2025 and FY 2026, which would further compress EV/EBITDA and P/E as the market digests the new outlook. |
| Risk considerations | The compression assumes stable SG&A and R&D spend. If the company accelerates hiring or launches costly new platforms, the EBITDA margin could be throttled, muting the multiple‑compression effect. Also, any macro‑headwinds that hit pharma‑R&D spend could reverse the high‑value mix momentum. |
5. Bottom line
- EV/EBITDA: With an estimated ~15 % EBITDA increase and a relatively unchanged enterprise value in the short run, the EV/EBITDA multiple is expected to shrink by roughly 12‑15 %. If the market bumps the stock price by 5 % to reflect the stronger earnings outlook, the multiple still compresses to the low‑20s (≈ 27×), well below the prior‑year level.
- P/E: Assuming the earnings boost translates into a ~15 % net‑income rise, the P/E will temporarily expand if the price stays flat, but a modest price appreciation (≈ 5 %) will re‑anchor the P/E at its historical 12‑13× range. In other words, the earnings beat should not lead to an over‑valued P/E; instead, it will likely keep the multiple stable or even tighter after the market adjusts.
Overall, the Q2 2025 results are a positive catalyst for valuation: higher top‑line growth, a more lucrative product mix, and a clear margin improvement all point to a stronger earnings base that will either compress valuation multiples (if the market holds the price) or allow the multiples to stay in line with peers after a modest price re‑rating. Analysts should therefore raise earnings forecasts for the full year and consider a downward revision of EV/EBITDA and a stable or slightly lower P/E in their valuation models.