- If you are wondering whether Revvity's current share price offers good value or just more volatility, this article walks through the key numbers that matter.
- Revvity's share price last closed at US$98.31, with returns of a 2.0% decline over 7 days, an 11.5% decline over 30 days, a 0.2% gain year to date, and a 12.1% decline over the past year, adding important context before talking about value.
- Recent attention on Revvity has been shaped by ongoing coverage of its position in the pharmaceuticals and biotech space and how investors are reacting to sector wide sentiment. This backdrop helps explain why the stock's shorter term moves differ from its longer term returns.
- On our valuation checks, Revvity scores a 3 out of 6. Next we will compare different valuation approaches to see what that really implies, before finishing with a practical way to think about fair value that often gives a clearer overall picture.
Find out why Revvity's -12.1% return over the last year is lagging behind its peers.
Approach 1: Revvity Discounted Cash Flow (DCF) Analysis
A Discounted Cash Flow, or DCF, model takes projected future cash flows, discounts them back to today using a required return, and adds them up to estimate what the business might be worth right now.
For Revvity, the model uses a 2 Stage Free Cash Flow to Equity approach based on cash flow projections. The latest twelve month Free Cash Flow is about $500.4 million. Analyst inputs extend through 2029, with projected Free Cash Flow of $824 million by the end of that year. Simply Wall St then extrapolates additional years out to 2035 using gradually moderating growth assumptions.
When those future cash flows are discounted back and combined, the DCF model points to an estimated intrinsic value of about $139.75 per share. Compared with the recent share price of $98.31, this implies Revvity trades at roughly a 29.7% discount, which the model interprets as undervalued on this cash flow view.
Result: UNDERVALUED
Our Discounted Cash Flow (DCF) analysis suggests Revvity is undervalued by 29.7%. Track this in your watchlist or portfolio, or discover 46 more high quality undervalued stocks.
Approach 2: Revvity Price vs Earnings
P/E is a useful check for a profitable company like Revvity because it links what you pay per share directly to the earnings the business is already generating today. In general, higher expected growth and lower perceived risk can support a higher P/E, while slower growth or higher risk tend to justify a lower, more conservative P/E range.
Revvity currently trades on a P/E of 45.8x. That sits above the Life Sciences industry average of 34.2x and also above the peer average of 43.0x, which indicates the market is paying a richer price for each dollar of Revvity’s earnings than for many similar companies.
Simply Wall St’s Fair Ratio metric estimates what a more tailored P/E might look like for Revvity at 24.9x, taking into account factors such as its earnings growth profile, profit margins, industry, market cap and company specific risks. This tailored view can be more informative than a simple comparison with peers or the broad industry because it adjusts for Revvity’s own characteristics rather than assuming every Life Sciences company should trade on the same multiple. With the current P/E of 45.8x sitting well above the Fair Ratio of 24.9x, this multiple-based view suggests Revvity is trading on the expensive side.
Result: OVERVALUED
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Upgrade Your Decision Making: Choose your Revvity Narrative
Earlier we mentioned that there is an even better way to understand valuation. Let us introduce you to Narratives, which let you turn your view of Revvity into a simple story that links assumptions about future revenue, earnings and margins to a forecast, a Fair Value, and a clear comparison against today’s price. This all happens inside an easy tool on Simply Wall St’s Community page that updates as fresh news or earnings arrive. You can, for example, lean toward a cautious Fair Value closer to around US$100 or a more optimistic view closer to about US$146, and then see how your chosen Narrative stacks up against Revvity’s current share price when you are deciding whether the stock looks attractive or stretched.
Do you think there's more to the story for Revvity? Head over to our Community to see what others are saying!
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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