As of June 21, 2025, Biogen Inc's estimated intrinsic value ranges from $108.08 to $221.62 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $221.62 | +75.1% |
| Discounted Cash Flow (5Y) | $205.63 | +62.5% |
| Dividend Discount Model (Multi-Stage) | $108.50 | -14.3% |
| Dividend Discount Model (Stable) | $108.08 | -14.6% |
| Earnings Power Value | $211.62 | +67.2% |
Is Biogen Inc (BIIB) undervalued or overvalued?
With the current market price at $126.54, the stock appears to be significantly undervalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Biogen 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 | 0.84 | 1.03 |
| Cost of equity | 7.7% | 10.6% |
| Cost of debt | 4.0% | 4.6% |
| Tax rate | 12.8% | 15.7% |
| Debt/Equity ratio | 0.33 | 0.33 |
| After-tax WACC | 6.7% | 8.9% |
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 | $206 | $33,831M | 72.9% |
| 10-Year Growth | $222 | $36,173M | 53.4% |
| 5-Year EBITDA | $226 | $36,792M | 75.1% |
| 10-Year EBITDA | $237 | $38,370M | 56.1% |
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 | $2,651M |
| Discount Rate (WACC) | 8.9% - 6.7% |
| Enterprise Value | $29,662M - $39,754M |
| Net Debt | $3,700M |
| Equity Value | $25,962M - $36,055M |
| Outstanding Shares | 147M |
| Fair Value | $177 - $246 |
| Selected Fair Value | $211.62 |
| Metric | Value |
|---|---|
| Market Capitalization | $18542M |
| Enterprise Value | $22241M |
| Trailing P/E | 12.53 |
| Forward P/E | 10.86 |
| Trailing EV/EBITDA | 12.60 |
| Current Dividend Yield | 0.00% |
| Dividend Growth Rate (5Y) | 0.00% |
| Debt-to-Equity Ratio | 0.33 |
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% | $66.49 |
| Discounted Cash Flow (5Y) | 25% | $51.41 |
| Dividend Discount Model (Multi-Stage) | 20% | $21.70 |
| Dividend Discount Model (Stable) | 15% | $16.21 |
| Earnings Power Value | 10% | $21.16 |
| Weighted Average | 100% | $176.97 |
Based on our comprehensive valuation analysis, Biogen Inc's weighted average intrinsic value is $176.97, which is approximately 39.8% above the current market price of $126.54.
Key investment considerations:
Given these factors, we believe Biogen Inc is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.