As of June 10, 2025, ABIOMED Inc's estimated intrinsic value ranges from $60.88 to $243.79 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $243.79 | -36.0% |
| Discounted Cash Flow (5Y) | $135.86 | -64.3% |
| Dividend Discount Model (Multi-Stage) | $99.90 | -73.8% |
| Dividend Discount Model (Stable) | $126.04 | -66.9% |
| Earnings Power Value | $60.88 | -84.0% |
Is ABIOMED Inc (ABMD) undervalued or overvalued?
With the current market price at $381.02, the stock appears to be significantly overvalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate ABIOMED Inc's intrinsic value, including:
The cost of capital is a critical factor in valuation models, representing the required return for investors.
| WACC Component | Low | High |
|---|---|---|
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.83 | 1.03 |
| Cost of equity | 7.7% | 10.7% |
| Cost of debt | 5.0% | 5.0% |
| Tax rate | 19.3% | 21.3% |
| Debt/Equity ratio | 1 | 1 |
| After-tax WACC | 5.9% | 7.3% |
Our DCF model projects cash flows over 5-year and 10-year horizons, with the following key assumptions:
| DCF Model | Fair Value | Enterprise Value | % from Terminal Value |
|---|---|---|---|
| 5-Year Growth | $136 | $5,944M | 90.5% |
| 10-Year Growth | $244 | $10,810M | 84.3% |
| 5-Year EBITDA | $118 | $5,126M | 89.0% |
| 10-Year EBITDA | $199 | $8,771M | 80.6% |
The DDM values a company based on its expected future dividend payments. We used two approaches:
EPV assesses a company's value based on its current normalized earnings power, assuming no growth.
| EPV Component | Value |
|---|---|
| Normalized Earnings | $167M |
| Discount Rate (WACC) | 7.3% - 5.9% |
| Enterprise Value | $2,284M - $2,842M |
| Net Debt | $(182)M |
| Equity Value | $2,466M - $3,024M |
| Outstanding Shares | 45M |
| Fair Value | $55 - $67 |
| Selected Fair Value | $60.88 |
| Metric | Value |
|---|---|
| Market Capitalization | $17181M |
| Enterprise Value | $16998M |
| Trailing P/E | 64.40 |
| Forward P/E | 94.04 |
| Trailing EV/EBITDA | 14.30 |
| Current Dividend Yield | 0.00% |
| Dividend Growth Rate (5Y) | 0.00% |
| Debt-to-Equity Ratio | 0.86 |
To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:
| Valuation Method | Weight | Weighted Value |
|---|---|---|
| Discounted Cash Flow (10Y) | 30% | $73.14 |
| Discounted Cash Flow (5Y) | 25% | $33.97 |
| Dividend Discount Model (Multi-Stage) | 20% | $19.98 |
| Dividend Discount Model (Stable) | 15% | $18.91 |
| Earnings Power Value | 10% | $6.09 |
| Weighted Average | 100% | $152.08 |
Based on our comprehensive valuation analysis, ABIOMED Inc's weighted average intrinsic value is $152.08, which is approximately 60.1% below the current market price of $381.02.
Key investment considerations:
Given these factors, we believe ABIOMED Inc is currently significantly overvalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.