As of June 12, 2025, AstraZeneca PLC's estimated intrinsic value ranges from $5376.45 to $7821.80 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $7821.80 | -28.3% |
| Discounted Cash Flow (5Y) | $5986.81 | -45.1% |
| Dividend Discount Model (Multi-Stage) | $5969.43 | -45.3% |
| Dividend Discount Model (Stable) | $5376.45 | -50.7% |
| Earnings Power Value | $6263.01 | -42.6% |
Is AstraZeneca PLC (AZN.L) undervalued or overvalued?
With the current market price at $10906.00, 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 AstraZeneca PLC'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 | 4.0% | 4.5% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.74 | 0.88 |
| Cost of equity | 8.4% | 11.2% |
| Cost of debt | 4.0% | 4.9% |
| Tax rate | 19.4% | 24.5% |
| Debt/Equity ratio | 0.14 | 0.14 |
| After-tax WACC | 7.8% | 10.3% |
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 | $8,098 | $147,513M | 77.0% |
| 10-Year Growth | $10,580 | $184,631M | 60.8% |
| 5-Year EBITDA | $7,855 | $143,885M | 76.4% |
| 10-Year EBITDA | $9,750 | $172,214M | 58.0% |
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 | $13,553M |
| Discount Rate (WACC) | 10.3% - 7.8% |
| Enterprise Value | $132,211M - $173,989M |
| Net Debt | $26,416M |
| Equity Value | $105,795M - $147,573M |
| Outstanding Shares | 15M |
| Fair Value | $7,075 - $9,868 |
| Selected Fair Value | $6263.01 |
| Metric | Value |
|---|---|
| Market Capitalization | $163089M |
| Enterprise Value | $182619M |
| Trailing P/E | 28.38 |
| Forward P/E | 28.86 |
| Trailing EV/EBITDA | 8.25 |
| Current Dividend Yield | 226.65% |
| Dividend Growth Rate (5Y) | 6.69% |
| Debt-to-Equity Ratio | 0.14 |
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% | $2346.54 |
| Discounted Cash Flow (5Y) | 25% | $1496.70 |
| Dividend Discount Model (Multi-Stage) | 20% | $1193.89 |
| Dividend Discount Model (Stable) | 15% | $806.47 |
| Earnings Power Value | 10% | $626.30 |
| Weighted Average | 100% | $6469.90 |
Based on our comprehensive valuation analysis, AstraZeneca PLC's weighted average intrinsic value is $6469.90, which is approximately 40.7% below the current market price of $10906.00.
Key investment considerations:
Given these factors, we believe AstraZeneca PLC is currently significantly overvalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.