AMGN Fair Value Estimate
$230.0333.9% overvalued
Blended fair value estimate based on DCF, Graham Number, and earnings-based models.
AMGEN Inc
Exchange: NASDAQSector: HealthcareIndustry: Drug Manufacturers - General
Amgen discovers, develops, manufactures and delivers innovative medicines to fight some of the world's toughest diseases. Harnessing the best of biology and technology, Amgen reaches millions of patients with its medicines. More than 45 years ago, Amgen helped establish the biotechnology industry at its U.S. headquarters in Thousand Oaks, California, and it remains at the cutting edge of innovation, using technology and human genetic data to push beyond what is known today. Amgen is advancing a broad and deep pipeline and portfolio of medicines to treat cancer, heart disease, inflammatory conditions, rare diseases and obesity and obesity-related conditions. Amgen has been consistently recognized for innovation and workplace culture, including honors from Fast Company and Forbes. Amgen is one of the 30 companies that comprise the Dow Jones Industrial Average ®, and it is also part of the Nasdaq-100 Index ®, which includes the largest and most innovative non-financial companies listed on the Nasdaq Stock Market based on market capitalization.
Did you know?
Profit margin of 21.0% — that's well above average.
Current Price
$347.94
-1.51%GoodMoat Value
$230.03
33.9% overvaluedProfile
Valuation (TTM)
Market Cap$187.36B
P/E24.30
EV$233.82B
P/B21.64
Shares Out538.48M
P/Sales5.10
Revenue$36.75B
EV/EBITDA13.78
AMGEN Inc (AMGN) Valuation
GoodMoat Analysis
The current price of $353.93 is significantly above the GoodMoat Target of $230.03, indicating a negative margin of safety of approximately -54%. This valuation appears unfavourable from a strict value investing perspective, as the stock trades at a premium to both its own historical P/E and the sector average.
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Based on the GoodMoat Investment Framework's valuation assessment, AMGEN's current price of $353.93 is 54% above the platform's fair value estimate of $230.03. This results in a deeply negative margin of safety, placing it firmly in the 'Unfavourable' band as defined in Section 4, which requires a margin of safety of at least 20% to be considered favourable. The forward P/E of 24.7x is above the sector average for large-cap pharmaceuticals, which typically trades in the mid-to-high teens, and is also at the higher end of AMGEN's own historical range, suggesting the stock is not cheap. While the company shows some quality characteristics like a high ROE of 89.1% and a solid profit margin of 21.0%, the valuation multiples do not provide a sufficient cushion for a value investor. The 4.3% FCF yield is modest, and the high debt-to-equity ratio of 6.3 introduces financial risk that is not compensated for by a discounted price. Integrating this with the framework's decision logic, the stock fails the Valuation & Risk Gate due to severe overvaluation relative to the calculated intrinsic value and elevated multiples. Analysis based on data as of 2024-05-15.
AMGN Valuation Metrics
FCF$8.10B
FCF Growth Rate-0.86%
EPS Growth (CAGR)-0.86%
WACC10.00%
Fair Value Models
Graham Number, PEG-based, and Earnings-based models
View Fair Value →AMGN Valuation & Fair Value Analysis
AMGEN Inc (AMGN) valuation analysis using multiple fair value methodologies. GoodMoat calculates a blended fair value target using discounted cash flow (DCF) analysis, the Graham Number, and earnings-based valuation models.
The GoodMoat Fair Value target for AMGEN Inc is $230.03. The current stock price is $347.94, suggesting the stock is 51.3% overvalued.
The price-to-earnings (P/E) ratio is 24.30. Price-to-book ratio is 21.64. Price-to-sales ratio is 5.10. Enterprise value to EBITDA is 13.78. PEG ratio is 0.22.
GoodMoat's valuation models include the Graham Number (based on EPS and book value), an earnings-based model (discounted future EPS), and a PEG-adjusted valuation. The three models are averaged to produce a blended fair value estimate. Use these tools alongside the DCF calculator and reverse DCF to form a comprehensive view of AMGEN Inc's intrinsic value.