Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Thermo Fisher Scientific Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 5.2% to 2.9% 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 82, DPO 47, DIO 78). At a 7.3% WACC with mid-year discounting, the terminal value (81% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 15.6x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $411.57 per share, suggesting TMO is overvalued by 16.4% at the current price of $492.16.
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 | 7,987 | 8,395 | 8,959 | 9,486 | 9,757 | 10,001 |
| (−) Net Interest | 1,266 | 1,330 | 1,419 | 1,503 | 1,546 | 1,585 |
| (+) D&A | 1,834 | 1,734 | 1,710 | 1,867 | 2,068 | 2,119 |
| EBITDA | 11,087 | 11,459 | 12,088 | 12,857 | 13,371 | 13,705 |
| (−) Tax | 690 | 725 | 774 | 820 | 843 | — |
| (−) CapEx | 2,021 | 2,124 | 2,267 | 2,400 | 2,469 | — |
| (−) ΔWC | 453 | 655 | 905 | 847 | 435 | — |
| Free Cash Flow (FCF) | 7,922 | 7,954 | 8,142 | 8,790 | 9,624 | — |
| Peers' EBITDA Multiple | 15.6x | |||||
| Terminal Value | 214,349 | |||||
| WACC / Discount Rate | 7.31% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 7,648 | 7,155 | 6,825 | 6,866 | 7,005 | 150,613 |
| Enterprise Value | 186,113 | |||||
| Projection Period | 35,499 | 19.1% | ||||
| Terminal Value | 150,613 | 80.9% | ||||
| (−) Current Net Debt | 30,998 | |||||
| Equity Value | 155,115 | |||||
| (÷) Outstanding Shares | 377M | |||||
| Fair Price | $411 | -16.4% | ||||
| WACC \ EV/EBITDA Exit Multiple | 11.6x | 13.6x | 15.6x | 17.6x | 19.6x |
|---|---|---|---|---|---|
| 5.3% | $343 | $399 | $455 | $512 | $568 |
| 6.3% | $326 | $379 | $433 | $486 | $540 |
| 7.3% | $309 | $360 | $412 | $463 | $514 |
| 8.3% | $294 | $343 | $391 | $440 | $489 |
| 9.3% | $279 | $326 | $372 | $419 | $465 |
Current price: $492.16. 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.