Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Becton, Dickinson and Company's cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from -11.9% to 3.7% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 48, DPO 59, DIO 112). At a 7.0% WACC with mid-year discounting, the terminal value (82% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 18.0x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $154.34 per share, suggesting BDX is fairly valued by 2.8% at the current price of $158.80.
Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.
| 2026 | 2027 | 2028 | 2029 | 2030 | Terminal | |
|---|---|---|---|---|---|---|
| Profit Before Tax | 2,190 | 2,239 | 2,318 | 2,405 | 2,494 | 2,556 |
| (−) Net Interest | 474 | 484 | 502 | 520 | 540 | 553 |
| (+) D&A | 913 | 845 | 832 | 846 | 897 | 920 |
| EBITDA | 3,577 | 3,568 | 3,652 | 3,772 | 3,931 | 4,029 |
| (−) Tax | 207 | 212 | 219 | 227 | 236 | — |
| (−) CapEx | 892 | 912 | 944 | 979 | 1,015 | — |
| (−) ΔWC | -836 | 91 | 147 | 162 | 165 | — |
| Free Cash Flow (FCF) | 3,314 | 2,354 | 2,343 | 2,403 | 2,514 | — |
| Peers' EBITDA Multiple | 18.0x | |||||
| Terminal Value | 72,400 | |||||
| WACC / Discount Rate | 7.02% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 3,204 | 2,127 | 1,977 | 1,895 | 1,853 | 51,583 |
| Enterprise Value | 62,640 | |||||
| Projection Period | 11,057 | 17.7% | ||||
| Terminal Value | 51,583 | 82.3% | ||||
| (−) Current Net Debt | 18,330 | |||||
| Equity Value | 44,310 | |||||
| (÷) Outstanding Shares | 287M | |||||
| Fair Price | $154 | -2.8% | ||||
| WACC \ EV/EBITDA Exit Multiple | 14.0x | 16.0x | 18.0x | 20.0x | 22.0x |
|---|---|---|---|---|---|
| 5.0% | $130 | $152 | $174 | $196 | $218 |
| 6.0% | $122 | $143 | $164 | $185 | $206 |
| 7.0% | $114 | $134 | $154 | $174 | $194 |
| 8.0% | $107 | $126 | $145 | $164 | $184 |
| 9.0% | $100 | $119 | $137 | $155 | $173 |
Current price: $158.80. Green = undervalued, Red = overvalued.
Based on default parameters
This is an unlevered Free Cash Flow to Firm (FCFF) model with a 5-year projection period. Revenue, expenses, D&A, and working capital are projected using the same line-by-line approach as the Growth Exit models. The key difference is the terminal value methodology: instead of assuming perpetual cash flow growth, the terminal value is calculated by applying the industry peer median EV/EBITDA multiple to the projected Year 6 EBITDA.
Using a peer exit multiple anchors the terminal value to how the market currently prices comparable companies, rather than relying on a theoretical perpetual growth assumption. This approach captures relative valuation dynamics and is particularly useful when a company is expected to converge toward industry-average profitability over time. The sensitivity matrix shows how fair value changes across different WACC and EV/EBITDA multiple scenarios.