Smith & Nephew: Turnaround Is Taking Hold, and New Products Should Support Moat

Now that Smith & Nephew has made gradual and steady progress on improving its operations since CEO Deepak Nath came aboard, we’ve taken another look at its newer technologies that we think should help support its narrow moat over the longer term. We are leaving our fair value estimate unchanged. While we remain pessimistic about the firm’s ability to wrestle large joint reconstruction market share away from larger rivals such as Stryker, Zimmer Biomet, and Johnson & Johnson, we are more optimistic about Smith & Nephew’s products in other therapeutic areas.