As of June 2, 2025, Henry Schein Inc's estimated intrinsic value ranges from $71.72 to $201.52 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $201.52 | +187.9% |
| Discounted Cash Flow (5Y) | $172.78 | +146.9% |
| Dividend Discount Model (Multi-Stage) | $131.02 | +87.2% |
| Dividend Discount Model (Stable) | $71.72 | +2.5% |
| Earnings Power Value | $96.07 | +37.3% |
Is Henry Schein Inc (HSIC) undervalued or overvalued?
With the current market price at $69.99, 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 Henry Schein 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 | 0.4 | 0.46 |
| Cost of equity | 5.7% | 7.4% |
| Cost of debt | 5.1% | 5.6% |
| Tax rate | 23.0% | 23.6% |
| Debt/Equity ratio | 0.29 | 0.29 |
| After-tax WACC | 5.3% | 6.7% |
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 | $173 | $24,362M | 85.0% |
| 10-Year Growth | $202 | $27,954M | 71.0% |
| 5-Year EBITDA | $86 | $13,548M | 73.0% |
| 10-Year EBITDA | $117 | $17,413M | 53.5% |
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 | $876M |
| Discount Rate (WACC) | 6.7% - 5.3% |
| Enterprise Value | $13,041M - $16,505M |
| Net Debt | $2,764M |
| Equity Value | $10,277M - $13,741M |
| Outstanding Shares | 125M |
| Fair Value | $82 - $110 |
| Selected Fair Value | $96.07 |
| Metric | Value |
|---|---|
| Market Capitalization | $8749M |
| Enterprise Value | $11513M |
| Trailing P/E | 21.50 |
| Forward P/E | 16.71 |
| Trailing EV/EBITDA | 8.15 |
| Current Dividend Yield | 0.00% |
| Dividend Growth Rate (5Y) | 0.00% |
| Debt-to-Equity Ratio | 0.29 |
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% | $60.46 |
| Discounted Cash Flow (5Y) | 25% | $43.20 |
| Dividend Discount Model (Multi-Stage) | 20% | $26.20 |
| Dividend Discount Model (Stable) | 15% | $10.76 |
| Earnings Power Value | 10% | $9.61 |
| Weighted Average | 100% | $150.22 |
Based on our comprehensive valuation analysis, Henry Schein Inc's weighted average intrinsic value is $150.22, which is approximately 114.6% above the current market price of $69.99.
Key investment considerations:
Given these factors, we believe Henry Schein Inc is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.