Share count
175Mpeak FY2025
← All companies ← SOLS Manual SOMN → ← SNN Medical Devices & Equipment SSII →
SOLV, Solventum Corporation
Medical Devices & Equipment capital-intensive
Solventum Corporation, is a leading global healthcare company developing, manufacturing, and commercializing a broad portfolio of solutions that leverages deep material science, data science, and digital capabilities to address critical customer and patient needs.
We constantly seek to enable the improvement of standards of care and move healthcare forward with innovation powered by insights, clinical intelligence, technology, and manufacturing expertise.
Our 70+ year history of discovering and innovating advanced solutions has helped us solve our customers' toughest challenges.
The business
What it sells, where the money comes from, the kind of company it is.
Revenue · FY2025
$8.3B
+0.9% YoY · 1% 3-yr CAGR
Vital signs · TTM, with 4-yr average
Revenue $8.3B 4-yr avg $8.2B
Revenue $2.0B −3.0% vs yr-ago qtr
Operating margin 4.0% yr-ago 7.3%
Net income $13M yr-ago $137M
Net margin 0.6% yr-ago 6.6%
The business in brief
read the 10-K →What this business is and what moves its needle, from its own SEC filings.
- What it is
- Revenue is Products (76%) and Cost of software and rentals (24%).
- What moves the needle
- Operating margin has run about 21% through the cycle, a solid margin the cost base and competition set as much as the price does. Read this kind of business on the installed base and what follows it. On its own account, the filing leans hardest on pricing power & competition, set against the numbers in what the filing emphasizes, below.
- Is it a good business?
- Return on capital has sat near the cost of capital (median 12%). By owner earnings: roughly 14% of revenue reaches owners as cash, consistently. This is price-taker territory, where the balance sheet and the cycle matter more than any multiple; the rest is in the 10-K.
Every line is arithmetic on the company's filings, shown in full in the sections below.
Where the money comes from
read the 10-K →Products is 76% of revenue, with Cost of software and rentals the other meaningful line at 24%.
Revenue by product line, FY2025
- Products76%$6.3B
- Cost of software and rentals24%$2.0B
By geographyUnited States56%International44%
From the segment footnote of the company's own 10-K. Shares are of total revenue; the profit bar shows each segment's share of segment operating profit, before unallocated corporate costs.
The record
Ten years of arithmetic, read across the cycle.
The record, 2022–2025
realized figures from each filing · older years to the left| 2022’22 | 2023’23 | 2024’24 | 2025’25 | TTMTTMMar 2026 | |
|---|---|---|---|---|---|
| Income statement | |||||
| $8.1B | $8.2B | $8.3B | $8.3B | $8.3B | RevenueRevenue |
| 27% | 28% | 34% | 37% | 38% | SG&A / revenueSG&A/rev |
| 9% | 9% | 9% | 9% | 9% | R&D / revenueR&D/rev |
| $1.7B | $1.7B | $1.0B | $2.2B | $2.1B | Operating incomeOp. inc. |
| 20.8% | 20.6% | 12.6% | 26.2% | 25.5% | Operating marginOp. mgn |
| $1.3B | $1.3B | $479M | $1.6B | $1.4B | Net incomeNet inc. |
| 21% | 19% | 21% | 9% | 15% | Effective tax rateTax rate |
| Cash flow & returns | |||||
| $1.7B | $1.9B | $1.2B | $369M | $151M | Operating cash flowOp. cash |
| $578M | $561M | $555M | $489M | $495M | DepreciationDeprec. |
| ($279M) | ($31M) | $39M | ($1.8B) | ($1.9B) | Working capital & otherWC & other |
| $251M | $290M | $380M | $379M | $354M | CapexCapex |
| 3.1% | 3.5% | 4.6% | 4.6% | 4.3% | Capex / revenueCapex/rev |
| $1.4B | $1.6B | $805M | ($10M) | ($203M) | Owner earningsOwner earn. |
| 17.6% | 19.8% | 9.8% | −0.1% | −2.5% | Owner earnings marginOE mgn |
| $1.4B | $1.6B | $805M | ($10M) | ($203M) | Free cash flowFCF |
| 17.6% | 19.8% | 9.8% | −0.1% | −2.5% | Free cash flow marginFCF mgn |
| — | $0 | $0 | $696M | $696M | AcquisitionsAcquis. |
| 12% | 12% | 8% | 22% | 19% | ROICROIC |
| 11% | 12% | 16% | 31% | 29% | Return on equityROE |
| 11% | 12% | 16% | 31% | 29% | Retained to equityRetained/eq |
| Balance sheet | |||||
| $61M | $194M | $762M | $878M | $561M | Cash & investmentsCash+inv |
| — | $1.3B | $1.0B | $1.0B | $1.1B | ReceivablesReceiv. |
| — | $857M | $965M | $1.1B | $1.1B | InventoryInvent. |
| — | $477M | $618M | $687M | $699M | Accounts payablePayables |
| — | $1.7B | $1.4B | $1.4B | $1.4B | Operating working capitalOper. WC |
| — | $2.5B | $3.2B | $3.9B | $3.6B | Current assetsCur. assets |
| — | $1.7B | $2.7B | $3.1B | $3.3B | Current liabilitiesCur. liab. |
| — | 1.5× | 1.2× | 1.2× | 1.1× | Current ratioCurr. ratio |
| $6.4B | $6.5B | $6.4B | $5.7B | $5.6B | GoodwillGoodwill |
| — | $13.9B | $14.5B | $14.3B | $14.1B | Total assetsAssets |
| — | $0 | $8.0B | $5.0B | $5.1B | Total debtDebt |
| — | ($194M) | $7.2B | $4.2B | $4.5B | Net debt / (cash)Net debt |
| $11.7B | $11.7B | $3.0B | $5.0B | $5.0B | Shareholders’ equityEquity |
| 0.5% | 0.5% | 1.4% | 1.9% | 2.0% | Stock comp / revenueSBC/rev |
| Per share | |||||
| 173M | 173M | 174M | 175M | 176M | Shares out (diluted)Shares |
| $47.08 | $47.46 | $47.52 | $47.49 | $47.08 | Revenue / shareRev/sh |
| $7.78 | $7.79 | $2.76 | $8.88 | $8.16 | EPS (diluted)EPS |
| $8.27 | $9.41 | $4.63 | $-0.06 | $-1.16 | Owner earnings / shareOE/sh |
| $8.27 | $9.41 | $4.63 | $-0.06 | $-1.16 | Free cash flow / shareFCF/sh |
| $1.45 | $1.68 | $2.19 | $2.16 | $2.02 | Cap. spending / shareCapex/sh |
| $67.99 | $67.55 | $17.04 | $28.80 | $28.31 | Book value / shareBVPS |
Per-share growththe realized rate an owner's share compounded
| 3-yr | 5-yr | |
|---|---|---|
| Revenue / share | +0.3%/yr | +0.3%/yr (3-yr) |
| EPS | +4.5%/yr | +4.5%/yr (3-yr) |
| Capital spending / share | +14.2%/yr | +14.2%/yr (3-yr) |
| Book value / share | −24.9%/yr | −24.9%/yr (3-yr) |
The record, charted
FY2022–2025Each measure over its full record; the current point and the worst year marked.
ROIC
22%low FY2024
Owner earnings vs. net income
Owner earningsNet incomeThe accountant's number, and the cash an owner can take; the gap is the tell.
($10M)owner earningsvs.$1.6Bnet incomelow FY2025
Where the cash went
ReinvestBuybacksDividendsAcquisitionsRetainedBeyond op. cashEach year's outlays against its operating cash: the mix, and how it drifts. The hatched cap is spending beyond that year's operating cash — financed from the balance sheet or borrowing, not operations.
FY2022FY2025
Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.
In fiscal 2025 the business reported $1.6B of profit but ($10M) of owner earnings: $1.6B less than the profit line, taken out by capital spending and the timing of cash.
| FY2025 | FY2024 | FY2023 | FY2022 | |
|---|---|---|---|---|
| Reported net income | $1.6B | $479M | $1.3B | $1.3B |
| Depreciation & amortizationnon-cash charge added back | +$489M | +$555M | +$561M | +$578M |
| Stock-based compensationreal costnon-cash, but a real cost | +$161M | +$112M | +$39M | +$37M |
| Working capital & othertiming of cash in and out, other non-cash items | −$1.8B | +$39M | −$31M | −$279M |
| Cash from operations | $369M | $1.2B | $1.9B | $1.7B |
| Capital expenditurecash put back in to keep running and to grow | −$379M | −$380M | −$290M | −$251M |
| Owner earnings | ($10M) | $805M | $1.6B | $1.4B |
| Owner-earnings marginowner earnings ÷ revenue | 0% | 10% | 20% | 18% |
Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position . The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $161M), owner earnings is nearer ($171M).
Much of fiscal 2025's profit didn't arrive as operating cash; it sits in “working capital & other” above. That can be a real inventory or timing swing, or profit that doesn't run through operating cash at all: a heavy tax year, equity-method earnings, or investment income booked through investing. For a year like this, owner earnings understates the cash earned; the full cash-flow statement carries the rest.
Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.
Quality & stewardship
Returns, the balance sheet, capital allocation, and pay.
Owner’s Scorecard
FY2025 10-K · source on SEC EDGAR →
Will it survive?
- Interest expense not tagged in the data
What this means
No usable interest-expense line was tagged in the filing data, but the balance sheet carries real net debt — so the interest burden here is unknown, not absent. Read the debt on the net-debt check below.
- How heavy is the debt, net of cash? $4.2B · 1.9× operating profitModest net debtCash $878M − debt $5.0B
What this means
Netting $878M of cash and short-term investments against $5.0B of debt leaves $4.2B owed, about 1.9× a year's operating profit (2.3× on the gross debt, before the cash). Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
- Not enough data
What this means
The filing data didn't include the inputs for this check.
Is it a good business?
- Solid through the cycle4-yr median, range 8%–22%; 22% latest = NOPAT $2.0B ÷ invested capital $9.2BIndustry peers: median 8%
What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 4 years (it ran 22% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
- Solid through the cycle4-yr median margin, range -0%–20%; latest ($10M) = operating cash $369M − maintenance capex $379MIndustry peers: median 12%
What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's -0% of revenue this year, a 10% median across 4 years. Treating stock comp as the real expense it is (less $161M of SBC) leaves ($171M).
- Thinly cash-backedCash from ops $369M ÷ net income $1.6B
What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.
How is the cash used?
- Not enough data
What this means
The filing data didn't include the inputs for this check.
- Investing or harvesting? 0.78×HarvestingCapex $379M ÷ depreciation $489M
What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.
Graham’s defensive tests · 1 of 3 met
Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.
- Adequate size PassRevenue ≥ $2B · $8.3B
What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
- Strong liquidity MissCurrent ratio ≥ 2× · 1.23×
What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
- Conservative debt MissDebt ≤ working capital · $5.0B vs $723M WC
What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
- Moderate price —P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price
What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $6.51/share (latest year $8.99), the averaged base the calculator's gate runs on, and book value is $29.16/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.
Durability & moat, 2022–2025
Whether the record’s returns held, and what the capital reinvested earned.
- Profitable years 4 of 4
What this means
Never lost money over the record, the earnings stability Graham insisted on.
- Return on capital ≥ 15% 1 of 3 yrs
What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
- Operating margin 21% → 19% (2-yr avg ends)
What this means
Through the cycle the operating margin held roughly steady — about 21% early, 19% lately, median 21%.
- Reinvestment, incremental ROIC returns capital
What this means
The capital base barely grew: this business returns cash through dividends and buybacks rather than reinvesting. Judge it on the cash returned, not on compounding.
- Owner earnings growth −36%/yr
What this means
Owner earnings shrank about 36% a year over the record.
- Worst year 2024 · 12.6% op. margin
What this means
Stayed profitable even in its hardest year, the resilience that survives recessions.
- Share count +0.5%/yr
What this means
Roughly flat share count, little dilution, little buyback.
Does AI threaten the moat?
Low contestabilityThe moat is physical, regulated or balance-sheet-funded, the kind AI cuts costs within but does not contest.
In its own filing A competitive risk, new this year
Its FY2025 10-K names artificial intelligence as a competitive threat, in language that was not in the prior year's filing.
“Any disruption or failure in the AI, machine learning, or other emerging technologies Solventum deploys or uses in its products and services, including as part of its research and development efforts, could adversely impact Solventum's business, including as a result of flawed AI algorithms, insufficient or biased data…”
AI is unlikely to contest a moat that is physical, regulated or balance-sheet-funded; here it reads more as a cost tool than a threat, and the company is using it that way.
Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.
All figures as filed; the source filing is linked above.
Current Position
as of the latest quarter, Mar 31, 2026Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.
Current assets$3.6B
- Cash & short-term investments$561M
- Receivables$1.1B
- Inventory$1.1B
- Other current assets$874M
Current liabilities$3.3B
- Debt due within a year$505M
- Accounts payable$699M
- Other current liabilities$2.1B
Current ratio1.07×all current assets ÷ what's due · Graham looked for 2×
Quick ratio0.75×stricter: inventory excluded
Cash ratio0.17×strictest: cash alone against what's due
Working capital$237Mthe cushion left after near-term bills
Debt due this year vs. cash$505M due · $561M cash
covered by cash on hand, no refinancing forced · both figures from the Mar 31, 2026 balance sheet
Revenue, latest quarter vs. a year ago−3.0%the freshest read on whether the business is still growing
Current ratio, recent quarters1.3× → 1.1×
Deeper floors
Tangible book value($3.2B)equity stripped of goodwill & intangibles
Net current asset value($5.5B)Graham's net-net: current assets less all liabilities
Debt incl. operating leases$5.3B$212M of it operating leases
Deferred revenue$613Mcustomer cash collected before delivery; operating float
From the company's latest filing.
How the cash was used, 2022–2025
Over the record, the business generated $5.1B of operating cash; how management split it reads as a balanced allocator, splitting cash between the business, owners, and the balance sheet.
- Reinvested$1.3B · 25%
- Retained (debt / cash)$3.8B · 75%
- Net change in share count1.6%
The diluted count rose from 173M to 176M: issuance (stock pay, deals) outran any buybacks, so owners were diluted on net.
- Dividend record—
No dividend line was reported in the filing data over the span; the record here neither confirms nor rules out a payout.
- Return on what it retained−10%
Of the earnings it kept rather than paid out ($4.7B over the span), annual owner earnings (first three years vs last three) fell $479M, so each retained $1 gave back about 0.10 of yearly owner earnings. Buffett's test, run on owner earnings instead of market value.
Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.
Acquisitions & goodwill
from the balance sheet & the 4-year cash-flow recordGoodwill grows only when a company acquires and falls only when it concedes it overpaid. The size of that bet, the cash put into buying rather than building, and how much has already been written off.
Goodwill & intangibles$8.3B58% of all assets; the premium carried on the balance sheet for businesses acquired
Against book equityexceeds itgoodwill alone is larger than the company’s entire book equity; stripped of the acquisition premium, there is no net book worth
Cash spent acquiring$696Mover 4 years buying other businesses, against $1.3B of capital spent building
None written down over the record; the goodwill is still carried at full cost. That is the deals holding their value on the books so far; whether they keep doing so is the test an owner watches, since the write-down, when it comes, is the admission the price was too high.
Goodwill, acquired intangibles and equity from the latest balance sheet; acquisition spend and write-downs summed across the 4-year record, from the company's own filings.
Management, ownership & pay
read the proxy →From the proxy: how much of the business the people running it own, and how they are paid.
- Insider ownership<1%
The stake all directors and executive officers hold together, per the 2026 proxy: skin in the game, the first thing Munger reads.
- CEO pay ratio245:1
What the chief earns for every dollar the median employee makes, per the 2026 proxy. A high ratio alone settles nothing; some businesses are genuinely top-heavy in scarce skill. A runaway figure is where Buffett starts asking whether the board is doing its job.
- Stock-based compensation$161M
The slice of the business handed to employees in shares this year, 2% of revenue, equal to 7% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.
Inverting the record
Invert: instead of why Solventum Corporation is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2022–2025.
1 of the 3 tests turned up something to look into; the other 2 came back clean.
- Look hereIs it less profitable than it was?4.8% vs 18.7%
The owner-earnings margin averaged 18.7% early in the record and 4.8% across the last three years, and the latest year has not recovered. Ask the filing whether that is a structural drift or a cyclical trough — price, mix, cost, or a competitor — and whether it is permanent.
And these came back clean
- Did the share count rise anyway?
- Did reported profit become cash?
Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.
What an owner would ask, FY2025
read the 10-K →- Which reported numbers are a judgment call?Management names Acquisitions as critical estimates
each rests partly on management's judgment; the filing's note sets out the assumptionsverify →
The questions the record and the charts do not answer on their own; each carries the figure and the place to look.
Peers, Medical Devices & Equipment
The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.
| Company | Revenue | Gross margin | Op. margin | ROIC | Owner earn. margin |
|---|---|---|---|---|---|
| MDLNMedline Inc. | $28.4B | 26% | 7.8% | 10% | 6% |
| MMM3M Company | $24.9B | 47% | 20.2% | 22% | 16% |
| BDXBecton Dickinson and Company | $21.8B | 45% | 11.6% | 5% | 14% |
| BAXBaxter International Inc. | $11.2B | 40% | 9.2% | 6% | 10% |
| SOLVSolventum Corporation | $8.3B | — | 20.7% | 12% | 14% |
| STESteris | $5.9B | 43% | 16.1% | 8% | 12% |
| WSTWest Pharmaceutical | $3.1B | 35% | 19.0% | 19% | 17% |
| ICUIICU Medical | $2.2B | 37% | 2.0% | 5% | 5% |
| Group median | — | — | 13.8% | 9% | 13% |
The price
What a price has to assume.
What the price implies
reverse-DCFType today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Solventum Corporation has delivered.
Solventum Corporation’s latest year shows negative owner earnings, below the record’s own through-cycle owner earnings. So the tool opens on the through-cycle base, the cash it would earn at rest; clear the toggle below to read the latest year exactly as reported.
$
Through the cycle, Solventum Corporation earns about $1.1B on its 13.7% median owner-earnings margin. This year’s −0.1% margin runs below that; the reported figure may understate a lean year. Normalize, below, values the price on that through-cycle figure rather than the latest year.
Base
—
The assumptions
9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.
Enter a price above to run it.
A dated snapshot of the price you typed, the assumptions you set, and what the page showed for them. A snapshot is never edited after it is saved. Your notebook is yours alone — the commitment states what is stored and what we will never do.
Implied by the price—
Owner-earnings growth · ’22→’25−36%/yr
Owner-earnings growth · ’22→’25−36%/yr
Owner-earnings yield—
What a growth belief costs, in multiples
The growth each return requires, at your price
P/E (3-yr earnings ’23–’25)—
P/B—
Graham’s price gate—
Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.
Against a high-grade bond: Graham’s yardstick bond yield%
Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.
Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.
Owner-earnings yield—
High-grade bond yield—
Margin over the bond—
Owner earnings ($203M) on 173M shares outstanding, per the 10-Q cover, as of 2026-04-30; net debt $4.5B. The base opens on the through-cycle figure (the latest year sits off the record’s own median, and Graham’s averaging cuts both ways); clear Normalize to use the year as filed. Net of stock comp treats option pay as the expense it is. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.
Cite: Owner Scorecard, "Solventum Corporation (SOLV), the owner's record," https://ownerscorecard.com/c/SOLV, data as of 2026-07-09.
Manual order: ← SOLS its page in the Manual SOMN →
Industry order: ← SNN the Medical Devices & Equipment chapter SSII →