As of June 18, 2025, UDG Healthcare plc's estimated intrinsic value ranges from $538.51 to $1148.82 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $974.59 | -9.7% |
| Discounted Cash Flow (5Y) | $881.48 | -18.3% |
| Dividend Discount Model (Multi-Stage) | $729.21 | -32.4% |
| Dividend Discount Model (Stable) | $1148.82 | +6.5% |
| Earnings Power Value | $538.51 | -50.1% |
Is UDG Healthcare plc (UDG.L) undervalued or overvalued?
With the current market price at $1079.00, the stock appears to be moderately 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 UDG Healthcare 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 | 2.9% | 3.4% |
| Equity market risk premium | 5.3% | 6.3% |
| Adjusted beta | 0.73 | 0.97 |
| Cost of equity | 6.8% | 10.1% |
| Cost of debt | 4.0% | 4.5% |
| Tax rate | 20.9% | 22.6% |
| Debt/Equity ratio | 0.12 | 0.12 |
| After-tax WACC | 6.5% | 9.4% |
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 | $1,073 | $2,854M | 82.1% |
| 10-Year Growth | $1,186 | $3,140M | 65.3% |
| 5-Year EBITDA | $584 | $1,622M | 68.5% |
| 10-Year EBITDA | $748 | $2,036M | 46.5% |
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 | $138M |
| Discount Rate (WACC) | 9.4% - 6.5% |
| Enterprise Value | $1,469M - $2,136M |
| Net Debt | $150M |
| Equity Value | $1,318M - $1,986M |
| Outstanding Shares | 3M |
| Fair Value | $523 - $788 |
| Selected Fair Value | $538.51 |
| Metric | Value |
|---|---|
| Market Capitalization | $2719M |
| Enterprise Value | $2830M |
| Trailing P/E | 20.68 |
| Forward P/E | 36.82 |
| Trailing EV/EBITDA | 5.75 |
| Current Dividend Yield | 255.98% |
| Dividend Growth Rate (5Y) | 8.78% |
| Debt-to-Equity Ratio | 0.12 |
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% | $292.38 |
| Discounted Cash Flow (5Y) | 25% | $220.37 |
| Dividend Discount Model (Multi-Stage) | 20% | $145.84 |
| Dividend Discount Model (Stable) | 15% | $172.32 |
| Earnings Power Value | 10% | $53.85 |
| Weighted Average | 100% | $884.76 |
Based on our comprehensive valuation analysis, UDG Healthcare plc's weighted average intrinsic value is $884.76, which is approximately 18.0% below the current market price of $1079.00.
Key investment considerations:
Given these factors, we believe UDG Healthcare plc is currently moderately overvalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.