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Hologic, Inc. (HOLX) Intrinsic Value

DCF-based fair value calculation with Bear, Base, and Bull scenarios

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Hologic, Inc. (HOLX)

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Intrinsic Value (DCF)

Current$75.02
→
Intrinsic$120.64
+61%
$81.61$120.64$194.77
Market implies 5% growth for 5 years
DCF analysis suggests HOLX could have 61% upside at 16% growth — verify assumptions match your view.
At $75, the market prices in only 5% growth — below historical 16%, suggesting low expectations.
Range: Bear $82 → Bull $195. Current price implies expectations below the bear case — very conservative expectations.
Discount ↓Growth →12%14%16%18%
8%$146$159$173$187
10%$103$111$121$131
12%$78$85$92$99
14%$63$68$74$79

Bull Case

  • Bull case ($195) offers 160% upside at 20% growth, 9% discount
  • Price below even worst-case scenario — strong margin of safety
  • Market-implied growth (5%) ≤ historical CAGR (16%)

Bear Case

  • Bear case ($82) with 13% growth, 12% discount rate
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5-Year Free Cash Flow Projection

Year 1$1.33B
Year 2$1.55B
Year 3$1.81B
Year 4$2.10B
Year 5$2.45B
Terminal$36.00B

📐 Model Inputs

Growth Rate16.4%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Free Cash Flow$1.15BTTM actual
Bear g×0.8, r+2%
Base Historical CAGR
Bull g×1.2, r−1.5%
ℹ️

DCF estimates based on historical growth rates extrapolated forward. See FAQ below for full methodology.

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Frequently Asked Questions

Is HOLX stock undervalued or overvalued?
🟢 UNDERVALUED

HOLX trades at $75.02 vs. our DCF-derived intrinsic value of $120.64, implying +61% upside. At a 10.0% WACC and 16.4% projected FCF growth, the market appears to be underpricing the present value of HOLX's future cash flows. The bear case ($80.71) still suggests upside, providing margin of safety.

What is HOLX's intrinsic value?

Using a 5-year DCF model: Base FCF of $1.15B, projected at 16.4% 5Y CAGR (best of revenue, EPS, or FCF growth), discounted at 10.0% WACC, with 3.0% terminal growth. Terminal value calculated via Gordon Growth Model: TV = FCF₅ × (1+g) / (WACC−g). After deducting $498M net debt and dividing by 0.24B shares: Bear $80.71 | Base $120.64 | Bull $177.93. Current price $75.02 implies +61% to base case.

How is HOLX's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 16.4% growth derived from 5-year historical CAGR (best of revenue, EPS, or FCF growth, with 8% floor and 25% cap).

② Calculate terminal value at year 5 using perpetuity growth model with g=3.0%.

③ Discount all cash flows to PV using WACC=10.0%.

④ Sum PV of explicit period + PV of terminal value = Enterprise Value ($29.16B).

⑤ Subtract net debt, divide by shares outstanding.

Sensitivity analysis available above—adjust WACC ±2% or growth ±3% to stress-test the valuation. Implied EV/FCF multiple: 25.5x.