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    EW · NYQ · Healthcare

    Edwards Lifesciences Corporation

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 61.46

    Market price

    USD 93.26

    Implied upside

    -34.1%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    AdjustedCapital expenditure runs at 5.2% of revenue against depreciation of 2.9%. A perpetuity has to be a steady state, so the forecast tapers capex to maintenance at depreciation plus the reinvestment terminal growth requires (g/ROIC of NOPAT), and the terminal year carries on from there. The bridge is shown under Terminal Value.

    Current EV/EBITDA of 28.0x sits outside a defensible 3-20x band, so the exit multiple is capped at 20.0x. A multiple that far out usually means EBITDA is the wrong denominator for this business.

    Value Per Share

    Perpetuity growth
    USD 61.46-34.1%
    Exit multiple
    USD 86.89-6.8%
    Market price
    USD 93.26

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn1bn2bnFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 6.8bnUSD 7.4bnUSD 8.1bnUSD 8.8bnUSD 9.4bnUSD 10.0bnUSD 10.5bnUSD 10.9bnUSD 11.3bnUSD 11.6bn+6.2%
    EBITUSD 2.0bnUSD 2.2bnUSD 2.4bnUSD 2.6bnUSD 2.8bnUSD 2.9bnUSD 3.1bnUSD 3.2bnUSD 3.3bnUSD 3.4bn+6.2%
    NOPATUSD 1.8bnUSD 1.9bnUSD 2.1bnUSD 2.3bnUSD 2.4bnUSD 2.6bnUSD 2.7bnUSD 2.8bnUSD 2.9bnUSD 3.0bn+6.2%
    Add depreciation & amortisationUSD 193.6mUSD 212.8mUSD 231.9mUSD 250.6mUSD 268.4mUSD 285.1mUSD 300.1mUSD 313.2mUSD 323.9mUSD 332.0m+6.2%
    Less capital expenditureUSD -350.3mUSD -400.3mUSD -452.9mUSD -507.4mUSD -562.9mUSD -618.3mUSD -672.5mUSD -724.2mUSD -772.3mUSD -815.5m+9.8%
    Capex, % of revenue5.2%5.4%5.6%5.8%6.0%6.2%6.4%6.6%6.8%7.0%-
    Less increase in working capitalUSD -197.8mUSD -191.0mUSD -190.3mUSD -186.0mUSD -177.9mUSD -165.8mUSD -149.8mUSD -130.1mUSD -106.9mUSD -80.7m-9.5%
    Free cashflow to firmUSD 1.4bnUSD 1.6bnUSD 1.7bnUSD 1.8bnUSD 2.0bnUSD 2.1bnUSD 2.2bnUSD 2.3bnUSD 2.4bnUSD 2.5bn+6.4%
    Discount factor0.95960.88360.81370.74930.69000.63540.58510.53880.49610.4568-
    Present valueUSD 1.3bnUSD 1.4bnUSD 1.4bnUSD 1.4bnUSD 1.4bnUSD 1.3bnUSD 1.3bnUSD 1.2bnUSD 1.2bnUSD 1.1bn-
    Present Value Of The ForecastUSD 13.0bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta0.887Reported 0.832, pulled toward 1.0 (Blume)
    Cost of equity8.65%Risk-free + beta x equity risk premium
    Cost of debt5.29%Risk-free + 40bp, the spread for a AAA rating at 80.2x interest cover. Book interest / average debt was lower, at 2.9%.
    Market capitalisationUSD 53.8bn98.7% of capital
    Total debtUSD 705.4m1.3% of capital, book value as a proxy
    Tax rate12.0%Effective, capped at statutory
    WACC8.60%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 61.46

    60% of EV

    Forecast FCFF, final year
    USD 2.5bn
    Capex at depreciation, working capital in reinvestment
    USD 3.0bn
    Less reinvestment at g/ROIC (16.0% of NOPAT)
    USD -483.5m
    Capitalised
    USD 2.5bn
    ROIC (reported)
    15.6%
    Terminal value, undiscounted
    USD 42.6bn
    Terminal value, discounted
    USD 19.5bn
    Enterprise value
    USD 32.5bn
    Less net debt
    USD -3.5bn
    Equity value
    USD 36.0bn

    Exit at 20.0x EBITDA

    Value per shareUSD 86.89

    73% of EV

    Terminal value, undiscounted
    USD 75.2bn
    Terminal value, discounted
    USD 34.4bn
    Enterprise value
    USD 47.4bn
    Less net debt
    USD -3.5bn
    Equity value
    USD 50.9bn

    Spread between methods: 34%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    6.60%81.8685.1689.3694.84102.22
    7.60%68.8270.5372.6675.3278.72
    8.60%59.5060.3861.4662.7964.46
    9.60%52.5152.9253.4454.0854.88
    10.60%47.0847.2247.4147.6748.01

    Outlined: this model. Green text: above today's price of 93.26. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year10.8%6.7%12.5%
    EBIT margin34.5%29.6%45.6%
    Discount rate-8.6%6.4%
    Download as Excel

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    Yahoo Finance and RBA data. General information, not advice. Methodology.