What is BSX's DCF valuation?

Boston Scientific Corp (BSX) DCF Valuation Analysis

Executive Summary

As of December 15, 2025, Boston Scientific Corp has a Discounted Cash Flow (DCF) derived fair value of $87.76 per share. With the current market price at $92.58, this represents a potential upside of -5.2%.

Key Metrics Value
DCF Fair Value (5-year) $64.11
DCF Fair Value (10-year) $87.76
Potential Upside (5-year) -30.8%
Potential Upside (10-year) -5.2%
Discount Rate (WACC) 6.2% - 8.1%

Financial Performance & Projections

Revenue Trends

Revenue is projected to grow from $16747 million in 12-2024 to $41579 million by 12-2034, representing a compound annual growth rate of approximately 9.5%.

Fiscal Year Revenue (USD millions) Growth
12-2024 16747 18%
12-2025 18763 12%
12-2026 21022 12%
12-2027 23296 11%
12-2028 24889 7%
12-2029 27443 10%
12-2030 30129 10%
12-2031 32020 6%
12-2032 34635 8%
12-2033 37904 9%
12-2034 41579 10%

Profitability Projections

Net profit margin is expected to improve from 11% in 12-2024 to 18% by 12-2034, driven by operational efficiency and economies of scale.

Fiscal Year Net Profit (USD millions) Profit Margin
12-2024 1846 11%
12-2025 2306 12%
12-2026 2836 13%
12-2027 3409 15%
12-2028 3912 16%
12-2029 4596 17%
12-2030 5105 17%
12-2031 5487 17%
12-2032 6002 17%
12-2033 6640 18%
12-2034 7362 18%

DCF Model Components

1. Capital Expenditures (CapEx)

with a 5-year average of $633 million. Projected CapEx is expected to maintain at approximately 5% of revenue.

2. Depreciation & Amortization

Depreciation is based on an average useful life of 5 years for capital assets.

Fiscal Year D&A (USD millions)
12-2025 711
12-2026 804
12-2027 913
12-2028 1012
12-2029 1121
12-2030 1231

3. Working Capital Requirements

Net working capital is expected to increase gradually, with projected changes affecting free cash flow.

Components Average Days
Days Receivables 57
Days Inventory 193
Days Payables 75

4. Free Cash Flow Projections

Fiscal Year EBITDA Tax CapEx Change in NWC FCF
3M/2025 972 136 228 73 535
2026 4677 670 1021 593 2394
2027 5534 805 1131 419 3179
2028 6283 924 1208 260 3891
2029 7282 1085 1332 522 4342

DCF Valuation Parameters

Key Assumptions

  • Discount Rate (WACC): WACC / Discount Rate (selected: 6.2% - 8.1%)
  • Long-Term Growth Rate: Long-term Growth Rate (selected: 3.0% - 5.0%)
  • Terminal EV/EBITDA Multiple: 15.8x (based on peer average)

Valuation Summary

Valuation Method Fair Price (USD) Potential Upside
5-Year DCF (Growth) 64.11 -30.8%
10-Year DCF (Growth) 87.76 -5.2%
5-Year DCF (EBITDA) 51.82 -44.0%
10-Year DCF (EBITDA) 72.47 -21.7%

Enterprise Value Breakdown

  • 5-Year Model: $105,363M
  • 10-Year Model: $140,427M

Investment Conclusion

Is Boston Scientific Corp (BSX) a buy or a sell? Boston Scientific Corp is definitely a sell. Based on our DCF analysis, Boston Scientific Corp (BSX) appears to be fairly valued with upside potential of -5.2%. The company's strong projected growth in revenue and profitability, coupled with consistent capital expenditure, supports our positive outlook on its intrinsic value.

Key investment drivers include:

  • Expanding profit margins (from 11% to 18%)
  • Steady revenue growth (9.5% CAGR)
  • Strong free cash flow generation

Investors should consider a hold at the current market price of $92.58.