Amgen Inc. (AMGN) Stock Valuation — DCF Analysis
Drug Manufacturers - General · NASDAQ
Current Price
$355.20
Intrinsic Value
$346.29
-2.6% margin of safety
COMPETITIVE MOAT
↑Repatha's Cardiovascular Efficacy
New data reinforces Repatha's strong cardiovascular risk reduction in high-risk diabetes patients. This strengthens its market position and potential for continued growth in a significant therapeutic area.
↑Late-Stage Pipeline Strength
Amgen highlighted its robust late-stage pipeline at the Jefferies conference. This suggests a strong future product portfolio, mitigating reliance on current blockbusters.
↑AI Integration in Drug Development
The company's emphasis on AI gains indicates a commitment to innovation. This could lead to more efficient drug discovery and development, creating a competitive edge.
INVESTMENT RISKS
↓Patent Expirations and Competition
While not explicitly mentioned, Amgen, like all biotechs, faces the perpetual risk of patent expirations. This can lead to generic competition and revenue erosion for key products.
↓Regulatory Scrutiny and Approval Hurdles
The pharmaceutical industry is heavily regulated. Delays or rejections in drug approvals can significantly impact Amgen's growth trajectory and financial performance.
↓Pipeline Execution Uncertainty
Despite a strong pipeline, there's inherent risk in drug development. Not all promising candidates will reach market successfully, impacting future revenue streams.
Base case
AMGN base case valuation
A base case discounted cash flow model for AMGN estimates an intrinsic value of about $346.29 per share, against a current price of $355.2. The model assumes 4.9% annual free cash flow growth, a 10.0% discount rate, and a 22x exit multiple.
Intrinsic Value
$346.29
Margin of safety
-2.6%
Expected annual return
-0.5%
Base case assumptions: 4.9% annual growth, 10.0% discount rate, 22x exit multiple, 5 year projection. Data as of 2026-06-12.
This base case uses default assumptions and is not financial advice. The intrinsic value changes significantly when the growth rate or discount rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the AMGN valuation
Adjust the growth rate, discount rate, and exit multiple to see how the intrinsic value and margin of safety for Amgen Inc. respond.
Open DCF Calculator for AMGNCompany Overview
Amgen Inc., established in 1980 and headquartered in Thousand Oaks, California, is a global biotechnology leader focused on discovering, developing, manufacturing, and delivering groundbreaking human medicines. The company's scientific endeavors span several critical therapeutic categories, including inflammatory conditions, oncology and hematology, bone health, cardiovascular diseases, nephrology, and neuroscience. Its extensive portfolio features a range of significant pharmaceutical products. Notable examples include Enbrel, prescribed for conditions like plaque psoriasis, rheumatoid arthritis, and psoriatic arthritis; Neulasta, which helps cancer patients by reducing the risk of infection linked to a low white blood cell count; Prolia, utilized in postmenopausal women to combat osteoporosis; and Xgeva, designed to prevent skeletal-related complications. Otezla offers relief for adult patients suffering from plaque psoriasis, psoriatic arthritis, and oral ulcers associated with Behçet's disease. Aranesp addresses anemia and low red blood cell counts, while KYPROLIS is employed to treat patients with relapsed or refractory multiple myeloma. Furthermore, Repatha plays a vital role in lowering the incidence of major cardiovascular events such as myocardial infarction, stroke, and coronary revascularization. Amgen's comprehensive product lineup also encompasses Nplate, Vectibix, MVASI, Parsabiv, EPOGEN, KANJINTI, BLINCYTO, Aimovig, EVENITY, AMGEVITATM, Sensipar/Mimpara, NEUPOGEN, IMLYGIC, Corlanor, and AVSOLA. The company distributes its therapies worldwide, primarily serving healthcare providers, including physicians and their clinics, dialysis centers, hospitals, and pharmacies. Distribution is facilitated through pharmaceutical wholesale distributors, complemented by direct-to-consumer channels. Amgen actively engages in strategic collaborations. It has partnered with entities such as Novartis Pharma AG, UCB, Bayer HealthCare LLC, BeiGene, Ltd., Eli Lilly and Company, Datos Health, and Verastem, Inc., to jointly assess VS-6766 when combined with lumakrastm (Sotorasib) in patients with KRAS G12C-mutant non-small cell lung cancer. Another key alliance involves Kyowa Kirin Co., Ltd., for the co-development and commercialization of KHK4083, a Phase 3-ready anti-OX40 fully human monoclonal antibody targeting atopic dermatitis and other autoimmune conditions. Additionally, Amgen maintains research and development partnerships with Neumora Therapeutics, Inc. and Plexium, Inc.
Financial Metrics — AMGN Stock Valuation Data
Revenue/Share (TTM)
$68.96
FCF/Share (TTM)
$15.92
ROIC (TTM)
13.9%
ROE (TTM)
89.4%
P/FCF
22.3x
EV/EBITDA
15.2x
FCF Yield
4.48%
Debt/Equity
6.24x
Based on trailing twelve-month data, AMGN shows a free cash flow per share of $15.92 and a ROIC of 13.9%, key inputs for stock valuation using the DCF method. The P/FCF ratio of 22.3x and FCF yield of 4.48% are important context metrics when evaluating AMGN's stock valuation relative to peers.
Frequently Asked Questions
What is the intrinsic value of AMGN?
Amgen Inc. currently generates $15.92 in free cash flow per share. At the current price of $355.20, a DCF model would discount these cash flows at an appropriate WACC and apply a terminal growth rate to arrive at an intrinsic value. The result depends heavily on your growth and discount rate assumptions — a 1% change in WACC typically shifts the fair value estimate by 10-15%. In MiniValuator the model uses a single discount rate that you can edit directly, 10% by default, rather than a computed WACC.
Is AMGN undervalued?
AMGN trades at a P/FCF ratio of 22.3x with a free cash flow yield of 4.48%. This P/FCF is in a moderate range. However, whether AMGN is truly undervalued requires comparing the DCF intrinsic value to the current market price and evaluating whether the margin of safety is sufficient for your risk tolerance.
How do I value AMGN stock using DCF?
To perform a DCF valuation on Amgen Inc.: (1) Start with the trailing free cash flow per share ($15.92) as the base, (2) project future FCF growth over 5-10 years based on Drug Manufacturers - General industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting AMGN's risk profile — with a debt-to-equity of 6.24x, capital structure is an important factor, and (4) add a terminal value for cash flows beyond the projection period.
What is DCF valuation and how does it apply to AMGN?
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For Amgen Inc., this means projecting how much free cash flow the company will produce over the next 5-10 years, shaped by Drug Manufacturers - General trends, then discounting those amounts to today's dollars. AMGN's ROIC of 13.9% shows moderate capital returns.
How does WACC affect AMGN stock valuation?
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For AMGN, with a debt-to-equity ratio of 6.24x, the capital structure directly influences WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%. At an EV/EBITDA of 15.2x, the market's implied discount rate can be reverse-engineered for comparison. In MiniValuator you set this discount rate yourself as a single editable number, 10% by default, instead of computing a formal WACC.
Learn More
- See AMGN PE Valuation → — Earnings-based stock valuation using PE ratio analysis
- DCF Methodology — Step-by-step guide to discounted cash flow analysis
- PE Methodology — Guide to PE ratio stock valuation
- WACC — Understanding the discount rate used in DCF
- Margin of Safety — How to evaluate downside protection
- Intrinsic Value — How to evaluate stock fair value
- How to Calculate Intrinsic Value — Complete guide for investors
Related Valuations
All Healthcare valuationsDCF and P/E value AMGN with different methods and assumptions, so the two conclusions can differ. Compare the P/E fair value.
Price as of 2026-06-12. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.