Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Novo Nordisk A/S's cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from -3.6% to 7.0% 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 112, DPO 192, DIO 317). At a 7.6% WACC with mid-year discounting, the terminal value (84% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 14.9x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $84.16 per share, suggesting NVO is undervalued by 131.1% at the current price of $36.42.
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 | 17,405 | 18,286 | 19,490 | 20,691 | 22,129 | 22,682 |
| (−) Net Interest | 283 | 298 | 317 | 337 | 360 | 369 |
| (+) D&A | 5,871 | 6,959 | 7,899 | 8,229 | 8,289 | 8,496 |
| EBITDA | 23,560 | 25,543 | 27,707 | 29,257 | 30,778 | 31,548 |
| (−) Tax | 3,514 | 3,692 | 3,935 | 4,178 | 4,468 | — |
| (−) CapEx | 6,510 | 6,839 | 7,290 | 7,739 | 8,277 | — |
| (−) ΔWC | -183 | 766 | 1,046 | 1,043 | 1,250 | — |
| Free Cash Flow (FCF) | 13,719 | 14,246 | 15,435 | 16,297 | 16,784 | — |
| Peers' EBITDA Multiple | 14.9x | |||||
| Terminal Value | 469,748 | |||||
| WACC / Discount Rate | 7.58% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 13,227 | 12,767 | 12,859 | 12,621 | 12,082 | 326,020 |
| Enterprise Value | 389,576 | |||||
| Projection Period | 63,556 | 16.3% | ||||
| Terminal Value | 326,020 | 83.7% | ||||
| (−) Current Net Debt | 15,152 | |||||
| Equity Value | 374,424 | |||||
| (÷) Outstanding Shares | 4448M | |||||
| Fair Price | $84 | +131.1% | ||||
| WACC \ EV/EBITDA Exit Multiple | 10.9x | 12.9x | 14.9x | 16.9x | 18.9x |
|---|---|---|---|---|---|
| 5.6% | $70 | $81 | $92 | $103 | $114 |
| 6.6% | $67 | $78 | $88 | $98 | $109 |
| 7.6% | $64 | $74 | $84 | $94 | $104 |
| 8.6% | $62 | $71 | $81 | $90 | $99 |
| 9.6% | $59 | $68 | $77 | $86 | $95 |
Current price: $36.42. 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.