Definitive Analysis
Definitive Analysis

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Amgen Inc. (AMGN)

Company Dividend Discount ModelIndustry: Drug Manufacturers - GeneralSector: Healthcare

Valuation Snapshot

Stable Growth$241.10 - $512.26$342.50
Multi-Stage$210.94 - $229.98$220.29
Blended Fair Value$281.39
Current Price$282.20
Upside-0.29%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS6.61%10.07%8.928.417.757.416.936.486.486.215.544.42
YoY Growth--6.06%8.58%4.56%6.87%7.01%0.06%4.22%12.24%25.13%29.44%
Dividend Yield--2.86%2.97%3.21%3.06%2.79%3.20%3.38%3.65%3.37%2.95%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)7,005.00
(-) Cash Dividends Paid (M)5,046.00
(=) Cash Retained (M)1,959.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)1,401.00875.63525.38
Cash Retained (M)1,959.001,959.001,959.00
(-) Cash Required (M)-1,401.00-875.63-525.38
(=) Excess Retained (M)558.001,083.381,433.63
(/) Shares Outstanding (M)541.50541.50541.50
(=) Excess Retained per Share1.032.002.65
LTM Dividend per Share9.329.329.32
(+) Excess Retained per Share1.032.002.65
(=) Adjusted Dividend10.3511.3211.97
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate4.61%5.61%6.61%
Fair Value$241.10$342.50$512.26
Upside / Downside-14.57%21.37%81.53%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)7,005.007,397.827,812.678,250.798,713.479,202.109,478.16
Payout Ratio72.03%75.63%79.22%82.81%86.41%90.00%92.50%
Projected Dividends (M)5,046.005,594.786,189.246,832.787,529.038,281.898,767.30

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate4.61%5.61%6.61%
Year 1 PV (M)5,079.665,128.225,176.77
Year 2 PV (M)5,102.005,200.015,298.95
Year 3 PV (M)5,113.895,261.965,412.85
Year 4 PV (M)5,116.165,314.625,518.79
Year 5 PV (M)5,109.595,358.535,617.08
PV of Terminal Value (M)88,702.2693,023.8697,512.28
Equity Value (M)114,223.55119,287.18124,536.72
Shares Outstanding (M)541.50541.50541.50
Fair Value$210.94$220.29$229.98
Upside / Downside-25.25%-21.94%-18.50%

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