{"schemaVersion":1,"research":true,"symbol":"ste","name":"STERIS plc","topic":"moat","path":"/stock/ste/moat","status":"published","version":7,"updatedAt":"2026-10-19T20:52:36.511Z","locked":false,"publicFairValue":false,"fairValue":null,"moat":{"verdict":"uncertain","summary":"STERIS has established sterilization, validation and equipment-service capabilities, substantial recurring demand and demonstrated pricing increases. These support potential switching costs and technical advantages, but the passages do not establish durable protection against competitors. This is insufficient moat evidence, rather than demonstrated competitive weakness. Recent AST volume declines and segment margin compression temper favorable growth and execution.","advantages":[{"mechanism":"switching_costs","claim":"Process-validation support and lifetime equipment servicing create opportunities for embedded customer relationships. These are current capabilities; the cost or difficulty of switching suppliers is not demonstrated.","durability":"Potentially extends across equipment lives and manufacturing processes, but customer renewal history, revalidation requirements and actual switching costs are undisclosed.","risks":"Maintenance agreements are generally cancellable without penalty. Customers can use competing service providers or sterilize in-house. Latest AST organic growth depended on pricing while volume declined.","invalidation":"The switching-cost hypothesis would fail if customers routinely transferred validated processes or equipment servicing to alternatives without material expense, disruption or loss of performance. Persistent customer departures following price increases would also undermine it.","competitors":["Sterigenics","BBraun","Crothall","Olympus","Pentax"],"evidenceIds":["q331","q332","q503","q504","q715"],"counterEvidenceIds":["q270","q336","q27","q594"]},{"mechanism":"intangible_assets","claim":"STERIS possesses technical know-how, a substantial patent portfolio and operating capabilities in regulated sterilization markets. Their existence is evidenced; superior customer outcomes or exclusion of competitors is not.","durability":"Technical expertise and intellectual property may support differentiation, but patent counts do not establish economically important protection, remaining useful life or durable pricing premiums.","risks":"STERIS describes intellectual-property protection as limited and competition as intense. Innovation can displace existing offerings, while its impaired internally developed accelerator demonstrates that development spending can fail.","invalidation":"The technical-advantage hypothesis would fail if alternatives consistently matched performance and compliance at lower total cost, or if important patents proved unenforceable or commercially irrelevant and customers migrated.","competitors":["Sterigenics","Belimed","Contec","Ecolab","Fedegari","Getinge","Stilmas"],"evidenceIds":["q29","q331","q336","q359"],"counterEvidenceIds":["q34","q55","q513","q528"]}],"evidence":[{"id":"q29","sourceId":"filing-1","location":"Item 1, AST business description","excerpt":"Our AST segment supports medical device and pharmaceutical manufacturers through a global network of contract sterilization and laboratory testing facilities, and integrated sterilization equipment and control systems."},{"id":"q27","sourceId":"filing-1","location":"Item 1, Healthcare service competition","excerpt":"On a service line basis, competitors include BBraun, Crothall, Olympus and Pentax."},{"id":"q34","sourceId":"filing-1","location":"Business competition discussion","excerpt":"Competition is intense in all of our business segments and includes many large and small competitors."},{"id":"q55","sourceId":"filing-1","location":"Intellectual-property risk discussion","excerpt":"These measures afford only limited protection, and competitors may gain access to our intellectual property and proprietary information."},{"id":"q128","sourceId":"filing-1","location":"Note 13, fiscal 2024–2026 segment results","excerpt":"Year Ended March 31, 2026 (in millions) Healthcare AST Life Sciences Corporate Company Revenues $ 4,208.6 $ 1,138.5 $ 588.8 $ — $ 5,935.9 Segment expenses Cost of revenues 2,422.5 552.8 262.7 Selling, general, and administrative 652.3 57.7 65.0 Research and development 97.5 3.3 10.3 Total income from operations before adjustments $ 1,036.4 $ 524.7 $ 251.0 $ (430.1) $ 1,381.9 Less: Adjustments Amortization of acquired intangible assets (1) 265.0 Acquisition and integration related charges (2) 6.2 Tax restructuring costs (3) 0.5 Amortization of inventory and property \"step up\" to fair value (1) 5.0 Restructuring charges (4) 3.4 Total income from operations $ 1,101.8 Year Ended March 31, 2025 (in millions) Healthcare AST Life Sciences Corporate Company Revenues $ 3,878.7 $ 1,038.6 $ 542.3 $ — $ 5,459.5 Segment expenses Cost of revenues 2,204.1 516.7 243.7 Selling, general, and administrative 610.0 52.5 59.8 Research and development 93.1 3.8 9.4 Total income from operations before adjustments $ 971.5 $ 465.6 $ 229.4 $ (399.0) $ 1,267.5 Less: Adjustments Amortization of acquired intangible assets (1) 273.8 Acquisition and integration related charges (2) 11.2 Tax restructuring costs (3) 0.1 Amortization of inventory and property \"step up\" to fair value (1) 5.4 Restructuring charges (4) 62.3 Illinois EO litigation settlement (5) 48.2 Total income from operations $ 866.6 92 STERIS PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Year Ended March 31, 2024 (in millions) Healthcare AST Life Sciences Corporate Company Revenues $ 3,613.0 $ 954.0 $ 571.7 $ — $ 5,138.7 Segment expenses Cost of revenues 2,083.9 458.4 283.9 Selling, general, and administrative 568.0 51.7 58.2 Research and development 89.8 4.1 8.3 Total income from operations before adjustments $ 871.4 $ 439.7 $ 221.3 $ (348.5) $ 1,184.0 Less: Adjustments Amortization of acquired intangible assets (1) 266.4 Acquisition and integration related charges (2) 25.5 Tax restructuring costs (3) 0.6 Net loss on divestiture of businesses (1) 0.9 Amortization of inventory and property \"step up\" to fair value (1) 10.0 Restructuring charges (4) 44.4 Total income from operations $ 836.1 (1) For more information regarding our recent acquisitions and divestitures, refer to Note 3 titled, \"Business Acquisitions, Divestitures, and Investments\" (2) Acquisition and integration related charges include transaction costs and integration expenses associated with acquisitions."},{"id":"q270","sourceId":"filing-1","location":"Revenue recognition, maintenance and extended-warranty contract cancellation","excerpt":"Generally, these contract terms are cancellable without penalty and range from one to five years."},{"id":"q331","sourceId":"filing-1","location":"Item 1, AST development, testing and validation support","excerpt":"Our technical professionals support Customers in all phases of product development, materials testing, and process validation."},{"id":"q332","sourceId":"filing-1","location":"Item 1, AST installed-base service support","excerpt":"Our AST segment also provides service support to our global installed base of integrated sterilization equipment and control systems, including installation, preventive maintenance, updates, repairs, and troubleshooting."},{"id":"q336","sourceId":"filing-1","location":"Item 1, AST regulation and competition","excerpt":"Competition. AST operates in a highly regulated industry and competes with Sterigenics, other smaller contract sterilization companies, other manufacturers of sterilization equipment and control systems, and manufacturers that sterilize products in-house."},{"id":"q359","sourceId":"filing-1","location":"Item 1, patents held and applications at March 31, 2026","excerpt":"As of March 31, 2026, we held 606 United States patents and 2,402 patents in other jurisdictions and had 94 United States patent applications and 235 patent applications pending in other jurisdictions."},{"id":"q503","sourceId":"filing-1","location":"Item 1, Healthcare lifetime equipment maintenance","excerpt":"We offer various preventive maintenance programs and repair services to support the effective operation of capital equipment over its lifetime."},{"id":"q504","sourceId":"filing-1","location":"Item 1, Healthcare repair, consulting and outsourced processing","excerpt":"Our Healthcare segment also provides comprehensive instrument, devices, and endoscope repair and maintenance services (on-site or at one of our dedicated facilities), custom process improvement consulting and outsourced instrument sterile processing (on-site at the hospital and in off-site reprocessing centers)."},{"id":"q513","sourceId":"filing-1","location":"Item 1, Life Sciences named competitors","excerpt":"Competitors include Belimed, Contec, Ecolab, Fedegari, Getinge, and Stilmas."},{"id":"q527","sourceId":"filing-2","location":"Consolidated cash flows, quarter ended June 30, 2026","excerpt":"5 Table of Contents STERIS PLC AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions) (Unaudited) Three Months Ended June 30, 2026 2025 Operating activities: Net income $ 201.0 $ 178.0 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation, depletion, and amortization 123.8 119.4 Deferred income taxes 0.6 — Share-based compensation expense 12.8 11.9 Other items 11.2 14.5 Changes in operating assets and liabilities, net of effects of acquisitions and divestitures: Accounts receivable, net 90.0 119.2 Inventories, net (73.3) (42.5) Other current assets (8.0) 18.9 Accounts payable 4.3 9.8 Accruals and other, net 4.8 (9.2) Net cash provided by operating activities 367.1 420.0 Investing activities: Purchases of property, plant, equipment, and intangibles (87.5) (93.6) Proceeds from the sale of property, plant, equipment, and intangibles — 0.1 Purchase of investments (5.0) — Acquisition of businesses, net of cash acquired (16.0) (15.0) Net cash used in investing activities (108.5) (108.5) Financing activities: Payments on Private Placement Senior Notes — (125.0) Payments under credit facilities, net (37.8) (30.5) Acquisition related deferred or contingent consideration (0.1) (0.1) Repurchases of ordinary shares (115.5) (10.6) Cash dividends paid to ordinary shareholders (61.4) (56.2) Stock option and other equity transactions, net 1.3 9.3 Net cash used in financing activities (213.5) (213.1) Effect of exchange rate changes on cash and cash equivalents (2.3) 9.6 Increase in cash and cash equivalents 42.8 108.0 Cash and cash equivalents at beginning of period 439.6 171.7 Cash and cash equivalents at end of period $ 482.3 $ 279.7 See notes to consolidated financial statements."},{"id":"q528","sourceId":"filing-2","location":"Restructuring plan, accelerator impairment and business changes","excerpt":"The Restructuring Plan includes a strategic shift in our approach to the Healthcare surgical business in Europe, as well as other actions including the impairment of an internally developed X-ray accelerator, product rationalizations and facility consolidations."},{"id":"q534","sourceId":"filing-2","location":"Restructuring plan, cumulative recorded expense","excerpt":"Total pre-tax restructuring expense of $110.1 million has been recorded relating to the Restructuring Plan since inception, of which $33.9 million has been recorded in Cost of revenues."},{"id":"q573","sourceId":"filing-2","location":"MD&A, consolidated gross profit percentage","excerpt":"Gross profit percentage for the first three months of fiscal 2027 was 45.8% compared to the gross profit percentage for the first three months of fiscal 2026 of 45.1%."},{"id":"q574","sourceId":"filing-2","location":"MD&A, pricing, productivity, mix and inflation effects","excerpt":"The increase in gross profit percentage for the three month period reflects favorable impacts from pricing, productivity and mix that were partially offset by unfavorable impacts from inflation."},{"id":"q575","sourceId":"filing-2","location":"MD&A, reported operating income comparison","excerpt":"Income from operations for the first three months of fiscal 2027 was $285.8 million, compared to income from operations of $246.0 million for the first three months of fiscal 2026."},{"id":"q594","sourceId":"filing-2","location":"MD&A, AST organic pricing and volume","excerpt":"The constant currency organic growth of 4.7% is primarily due to increased pricing, impacting revenues by a mid-single digit percentage, partially offset by a decline in volume."},{"id":"q596","sourceId":"filing-2","location":"MD&A, Life Sciences revenue growth by product and service","excerpt":"This increase reflects growth in capital equipment, consumable and service revenues of 17.4%, 8.2% and 2.4%, respectively."},{"id":"q597","sourceId":"filing-2","location":"MD&A, Life Sciences organic pricing and volume","excerpt":"The constant currency organic growth of 7.9% is primarily due to increased volume, impacting revenues by a mid-single digit percentage, as well as increased pricing, impacting revenues by a low-single digit percentage."},{"id":"q608","sourceId":"filing-2","location":"MD&A, AST operating-margin decline","excerpt":"Operating margin declined as higher depreciation expense, lower productivity and unfavorable labor inflation more than offset the benefit provided by higher pricing."},{"id":"q612","sourceId":"filing-2","location":"MD&A, Life Sciences operating-margin decline","excerpt":"Operating margin declined as lower productivity and higher materials cost more than offset the benefits of higher pricing and volume."},{"id":"q712","sourceId":"filing-2","location":"Revenue recognition, definition of firm remaining performance obligations","excerpt":"Remaining Performance Obligations\nRemaining performance obligations reflect only the performance obligations related to agreements for which we have a firm commitment from a Customer to purchase, and exclude variable consideration related to unsatisfied performance obligations."},{"id":"q715","sourceId":"filing-2","location":"Revenue recognition, remaining performance obligations at June 30, 2026","excerpt":"As of June 30, 2026, the transaction price allocated to remaining performance obligations was approximately $1,541.4 million."},{"id":"q731","sourceId":"filing-2","location":"Notes, tariff refunds recognized in cost of product revenues","excerpt":"During the three months ended June 30, 2026, the Company received $3.9 million related to amounts previously paid pursuant to the International Economic Emergency Powers Act (\"IEEPA\"), consisting of $3.7 million of refunds recorded in Cost of product revenues and $0.2 million of interest recorded in Interest and miscellaneous income."},{"id":"q800","sourceId":"filing-3","location":"Proxy summary, governance and compensation safeguards","excerpt":"● ● ● ● ● ● ● ● 〇 89% Notice of Annual Meeting of Shareholders and 2026 Proxy Statement 5 Table of Contents Proxy Summary: Governance Highlights Governance Highlights • Strong Board independence (all but one of our directors and director nominees are independent); • All members of the Audit, Compensation and Organization Development and Nominating and Governance Committees are independent; • Annual election of directors; • Board conducts annual self-evaluation; • Independent non-employee Chairman of the Board; if the Company does not have an independent Chairman, a lead independent director will preside over executive sessions of independent directors (which will occur at least every other regularly scheduled Board meeting); • Robust stock ownership guidelines for non-employee directors, officers and other key employees; • Clawback policies applicable in specified situations to incentive compensation and equity awards; • No hedging or pledging or short sales of our shares is permitted by our directors, officers or employees; • Annual compensation risk assessment; • Incentive-based compensation programs linked to Company performance; and • No shareholder rights plan (Poison Pill)."},{"id":"q808","sourceId":"filing-3","location":"Board meetings and committees, actual fiscal 2026 attendance","excerpt":"30 Notice of Annual Meeting of Shareholders and 2026 Proxy Statement Table of Contents Board of Directors Information: Board Meetings and Committees Meetings Each incumbent director attended more than 75% in the aggregate of all meetings of the Board of Directors and the Committees on which they served while in office during fiscal 2026."},{"id":"q823","sourceId":"filing-3","location":"Governance, related-person transactions","excerpt":"Related Person Transactions Since the beginning of fiscal 2026, we have not been a participant in, and there are not currently proposed, any related person transactions (within the meaning of, and required to be disclosed under, Item 404(a) of Regulation S-K)."},{"id":"q872","sourceId":"filing-3","location":"Executive compensation, achieved bonus metrics and adjustments","excerpt":"Year Ended March 31, 2026 0% Threshold 100% Target 200% Maximum Weighting Twelve Months Adjusted Attainment % Weighting Attainment % Adjusted EBIT $ 1,167.3 $ 1,373.3 $ 1,510.6 75% $ 1,381.9 106.3 79.7 Adjusted FCF $ 626.8 $ 835.7 $ 1,044.6 25% $ 1,006.2 181.6 45.4 Total 125.1 56 Notice of Annual Meeting of Shareholders and 2026 Proxy Statement Table of Contents Executive Compensation: Compensation Discussion and Analysis A reconciliation of the Adjusted EBIT and Adjusted FCF used to determine the targets and actual achievement for the year ended March 31, 2026 is provided below: Year Ended March 31, 2026 Total Company EBIT Actual (in millions) Free Cash Flow Actual (in millions) Metric, as reported(1) $ 1,101.8 $ 982.9 Adjustments for comparability: Illinois EO litigation settlement $ — $ 15.1 Amortization of inventory and property “step up” to fair value $ 5.0 $ — Amortization of acquired intangible assets $ 265.0 $ — Acquisition, integration and tax structuring related expenses $ 6.7 $ 5.1 Restructuring charges $ 3.4 $ 3.0 Metric on comparable basis to target(2) $ 1,381.9 $ 1,006.2 (1) As reported in our earnings for fiscal 2026, EBIT is equal to Income from Operations and Free Cash Flow is as presented within the non-GAAP financial measures in our external earnings reporting."},{"id":"q949","sourceId":"filing-3","location":"Appendix A, fiscal 2026 and 2025 cash generation and capital expenditure","excerpt":"Twelve Months Ended March 31, 2026 2025 (Unaudited) (Unaudited) Calculation of Free Cash Flow (in millions): Cash flows from operating activities $ 1,341.4 $ 1,148.1 Purchases of property, plant, equipment, and intangibles, net (369.0 ) (370.1 ) Proceeds from the sale of property, plant, equipment, and intangibles 10.5 9.2 Free Cash Flow $ 982.9 $ 787.2 Notice of Annual Meeting of Shareholders and 2026 Proxy Statement A-1 Table of Contents STERIS plc 70 SIR JOHN ROGERSON’S QUAY DUBLIN 2, IRELAND (COMPANY NUMBER 595593) ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via the Internet."},{"id":"q1064","sourceId":"filing-3","location":"CEO compensation highlights, delivered annual incentive","excerpt":"100% of annual incentive compensation delivered to our CEO was tied to annual financial performance measures based on Adjusted EBIT and Adjusted free cash flow (“FCF”), paying out an aggregate amount of $1,725,007 at 125.1% of target for fiscal 2026 with no adjustments based upon personal achievement (see the section titled “2026 Compensation Decisions – STERIS Annual Incentive Compensation (Cash Bonus)” for more information on the calculation and definition of these metrics under the bonus plan);"},{"id":"q1065","sourceId":"filing-3","location":"CEO compensation highlights, delivered premium-price options","excerpt":"50% of variable Long-Term Incentive Plan (“LTIP”) opportunity was delivered to our CEO in the form of premium-price stock options, subject to an exercise price equal to 110% of the closing price per share of our Ordinary Shares on the grant date and pro-rata four-year vesting conditions; and"},{"id":"q1122","sourceId":"filing-3","location":"Compensation discussion, service and age-based vesting","excerpt":"Award vesting based primarily on continued service and/or, in some cases, age."},{"id":"q1891","sourceId":"filing-6","location":"MD&A, AST nine-month organic pricing and volume through December 2025","excerpt":"The constant currency organic growth of 8.5% is primarily due to increased pricing and volume, with pricing impacting revenues by a mid-single digit percentage, and volume impacting revenues by a low-single digit percentage, with service growth partially offset by a decline in capital equipment."},{"id":"q2020","sourceId":"filing-7","location":"Fiscal 2027 first-quarter release, Healthcare revenue growth by type","excerpt":"This performance reflected 10% improvement in service revenue, 9% growth in consumable revenue, and a 1% increase in capital equipment revenue."},{"id":"q2027","sourceId":"filing-7","location":"New restructuring plan, expected charges and cash expenditures","excerpt":"The Company currently expects to incur total pre-tax restructuring charges of approximately $55 million to $70 million, consisting of approximately $40 million to $50 million of cash expenditures and approximately $15 million to $20 million of non-cash charges."},{"id":"q2037","sourceId":"filing-7","location":"Fiscal 2027 outlook, increased planned capital expenditure","excerpt":"Reflecting the recently announced investment to build a formulated chemistries manufacturing Center of Excellence in North Carolina, capital expenditures are now anticipated to be approximately $450 million compared with prior expectations of $375 million."},{"id":"q2269","sourceId":"filing-10","location":"Terms of sale, Section I, applicability and signed-agreement exceptions; retrieved October 19, 2026","excerpt":"Unless otherwise specified in the Offer, or some other document signed by Seller, the terms and conditions of sale and installation set forth in this document (“Seller’s Terms”) apply to all Products and Services sold or provided by Seller."},{"id":"q2270","sourceId":"filing-10","location":"Terms of sale, Section I, accepted order price; retrieved October 19, 2026","excerpt":"Customer acknowledges that any purchase order or other form of acceptance issued by Customer will result in a contract for the purchase of the Products or Services at the price quoted in the Offer."},{"id":"q2388","sourceId":"filing-10","location":"Terms of sale, Section XIV, conditional preferred pricing; retrieved October 19, 2026","excerpt":"Customer agrees that satisfying the purchase commitment is a material condition to receiving the preferred pricing, and Customer acknowledges if it does not satisfy the purchase commitment then the current list pricing will apply to future purchases."},{"id":"q2410","sourceId":"filing-10","location":"Terms of sale, Section XV, blanket-order pricing adjustment rights; retrieved October 19, 2026","excerpt":"If Customer fails to satisfy the purchase commitment, Seller may adjust pricing at its discretion or terminate the Blanket Order immediately upon written notice."},{"id":"q2528","sourceId":"filing-11","location":"Annual meeting results, completed election of directors for one-year terms","excerpt":"1.\n The shareholders elected the nominees named below to the Board, each for a one-year term, and the results of the vote were as follows: \n \n Nominee\n \n Votes for\n \n \n Votes\nagainst\n \n \n Abstentions\n \n \n Broker\nnon-votes\n \n Dr."},{"id":"q2542","sourceId":"filing-11","location":"Annual meeting results, approved renewal of pre-emption opt-out authority","excerpt":"The shareholders approved the proposal to approve the renewal of the Board’s authority to opt-out of statutory pre-emption rights under Irish law regarding the issuance of shares for cash, by the following votes: \n \n Votes for\n \n \n 86,256,858\n \n Votes against\n \n \n 3,483,603\n \n Abstentions\n \n \n 168,743\n \n \n SIGNATURES \n Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized."}],"changes":["Uncertain verdict retained: the current catalog establishes capabilities and favorable operating outcomes without demonstrating durable competitive barriers.","Contractual freedom remains 2 after re-examining the supplied sale terms; their retrieval date is not treated as a publication date.","Other prior numerical grades remain supported by current catalog passages, with retention explicitly assessed from indirect demand evidence.","Completed annual director elections and approval of pre-emption opt-out authority are now distinguished from the earlier proxy proposals."],"limitations":["Evidence is primarily issuer disclosure. Claimed market-share gains are not treated as demonstrated comparative results.","Named competitors are established, but comparative customer outcomes, switching economics, capacity economics and market shares are not supplied. Ecolab's separate disclosures do not establish STERIS's advantages or results.","No demonstrated renewal rate, customer-cohort retention, revalidation cost or exclusivity is disclosed. Recurring revenue and firm orders support demand, not proof of customer lock-in.","Patent counts and regulated operations do not establish patent-level economic protection or barriers unique to STERIS. No network effect, relative cost advantage or efficient-scale protection is demonstrated.","Sale terms provide bounded contractual discretion and can be superseded by a written offer or signed agreement; applicability across actual customer contracts is not quantified.","Executive ownership compliance and durable governance outcomes are not established. Compensation disclosures describe actual delivered awards, while service-based vesting and adjusted bonus metrics limit alignment conclusions.","Latest supplied operating results cover June 30, 2026. Future investment benefits and restructuring estimates remain prospective."],"qualityAssessments":[{"category":"moat","checks":[{"criterion":"structural_advantage","grade":null,"rationale":"Validation expertise, installed-base servicing and patents establish capabilities, but their comparative economic protection is unproven. The uncertain verdict reflects missing evidence rather than low barriers demonstrated by results.","evidenceIds":["q331","q332","q359","q336"]},{"criterion":"durability","grade":null,"rationale":"Lifetime service opportunities suggest persistence, but the catalog does not establish enduring switching friction or commercially decisive patent protection.","evidenceIds":["q503","q55","q359"]},{"criterion":"customer_dependency","grade":null,"rationale":"Integrated services and firm obligations demonstrate customer use and commitments, but do not establish dependence on STERIS specifically; maintenance cancellation is generally penalty-free.","evidenceIds":["q504","q712","q715","q270"]},{"criterion":"erosion_resilience","grade":null,"rationale":"Pricing gains coexist with AST volume decline and segment cost pressure. These outcomes cannot establish resilience of a structural advantage whose magnitude remains unproven.","evidenceIds":["q594","q608","q612"]}]},{"category":"pricing_power","checks":[{"criterion":"realized_pricing","grade":3,"rationale":"AST pricing contributed a mid-single-digit percentage to organic revenue growth in both the nine months through December 2025 and June 2026 quarter. Life Sciences also realized higher prices. Repeated outcomes provide strong evidence, tempered by issuer attribution and latest AST volume decline.","evidenceIds":["q1891","q594","q597"]},{"criterion":"retention","grade":2,"rationale":"Healthcare service and consumable growth, Life Sciences recurring-product growth and $1,541.4 million of firm remaining obligations support continuing demand indirectly. They do not identify retained customers. Cancellable maintenance and declining AST volume make the evidence mixed.","evidenceIds":["q2020","q596","q712","q715","q270","q594"]},{"criterion":"margin_resilience","grade":2,"rationale":"Consolidated gross profit percentage rose from 45.1% to 45.8%, with pricing, productivity and mix contributing. AST and Life Sciences nevertheless experienced operating-margin declines as costs and lower productivity outweighed benefits. Tariff refunds also benefited product costs. This is mixed resilience, without inferring a moat from margins.","evidenceIds":["q573","q574","q608","q612","q731"]},{"criterion":"contractual_freedom","grade":2,"rationale":"Standard terms establish quoted pricing, preferred-price conditions and discretion to adjust blanket-order prices when commitments are unmet. Accepted orders use the quoted price, and written offers or signed agreements can supersede the terms. This supports bounded discretion, without proving unrestricted or company-wide repricing.","evidenceIds":["q2269","q2270","q2388","q2410"]}]},{"category":"strong_management","checks":[{"criterion":"capital_discipline","grade":2,"rationale":"Fiscal 2026 operating cash flow increased while capital expenditure stayed approximately stable. Latest-quarter cash generation funded investment, distributions and credit repayments. Accelerator impairment and $110.1 million of cumulative restructuring expense demonstrate shortcomings. Increased planned capital spending and new restructuring commitments have no demonstrated return yet; repurchases alone do not establish value creation.","evidenceIds":["q949","q527","q528","q534","q2027","q2037"]},{"criterion":"incentive_alignment","grade":3,"rationale":"Actual CEO bonuses were tied to adjusted EBIT and cash flow, and delivered options carried a 110% exercise price with four-year vesting. Clawbacks and trading restrictions support alignment. Adjusted-metric exclusions, primarily service-based vesting and missing executive ownership compliance limit the assessment.","evidenceIds":["q1064","q1065","q872","q800","q1122"]},{"criterion":"execution","grade":3,"rationale":"Multi-year segment revenue growth, increased annual cash generation and latest-quarter reported operating income rising from $246.0 million to $285.8 million demonstrate strong execution indirectly through operating outcomes. Impairment, restructuring costs and declining AST volume are realized counterevidence. Management's share-gain claims are not used as verified market-share results.","evidenceIds":["q128","q949","q575","q528","q534","q594"]},{"criterion":"governance","grade":3,"rationale":"Disclosed board and committee independence, an independent chair, completed annual elections, attendance above 75% and no reportable related-person transactions support strong practices. Approved pre-emption opt-out authority creates potential dilution discretion but does not establish misuse. 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