Does Becton Dickinson’s Recent Slide Create an Opportunity for Long Term Investors in 2025?

• Wondering if Becton Dickinson is quietly turning into a value opportunity while most investors are looking elsewhere? Let us walk through what the current share price is really baking in.
• The stock now trades around $195.59, down 2.2% over the last week and 13.6% year to date, even though it has managed a modest 1.5% gain over the last month.
• Recent interest has been driven by Becton Dickinson sharpening its focus on higher margin medical technologies and continuing to integrate past acquisitions to streamline its portfolio. At the same time, investors are weighing industry wide shifts in procedure volumes and hospital capital spending, which helps explain the mixed share price performance.
• On our framework, Becton Dickinson scores a 3 out of 6 on valuation checks. This suggests the market may be underestimating parts of the story, but not across the board. We will break that down using several valuation approaches before exploring an even more powerful way to think about its true worth later in the article.

Find out why Becton Dickinson's -11.8% return over the last year is lagging behind its peers.

Approach 1: Becton Dickinson Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow model estimates what a company is worth by projecting the cash it can generate in the future and then discounting those cash flows back to today in $ terms.

For Becton Dickinson, the latest twelve month Free Cash Flow is about $2.6 billion. Analysts and model estimates see this climbing steadily, with projected Free Cash Flow of roughly $5.4 billion by 2030. The 2 Stage Free Cash Flow to Equity model uses detailed analyst forecasts for the next few years and then extrapolates further growth, with Simply Wall St extending those projections out over the following decade.

When all those future cash flows are discounted back to today, the model arrives at an intrinsic value of about $324.56 per share. Versus the recent market price around $195.59, the DCF implies the stock is trading at a 39.7% discount to its estimated fair value. This suggests the market is pricing in a much weaker future than these cash flow projections assume.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Becton Dickinson is undervalued by 39.7%. Track this in your watchlist or portfolio, or discover 899 more undervalued stocks based on cash flows.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Becton Dickinson.

Approach 2: Becton Dickinson Price vs Earnings

For profitable companies like Becton Dickinson, the Price to Earnings ratio is a straightforward way to gauge how much investors are willing to pay for each dollar of current earnings. A higher PE can be justified if investors expect strong, durable growth with manageable risk, while slower growth or higher uncertainty typically calls for a lower, more conservative PE multiple.

Becton Dickinson currently trades on a PE of about 33.2x, which is slightly above the broader Medical Equipment industry average of around 29.7x and roughly in line with its direct peer group near 33.3x. Simply Wall St also calculates a Fair Ratio of 32.8x, a proprietary estimate of what Becton Dickinson’s PE should be after accounting for its earnings growth profile, margins, industry dynamics, market cap and specific risk factors.

This Fair Ratio is more informative than simple peer or industry comparisons because it adjusts for the company’s own fundamentals rather than assuming that similar companies automatically deserve similar valuations. With Becton Dickinson’s actual PE only marginally above the 32.8x Fair Ratio, the stock appears reasonably valued on earnings.

Result: ABOUT RIGHT

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1457 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Becton Dickinson Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives, a simple way to connect your view of Becton Dickinson’s story to a concrete set of forecasts for revenue, earnings and margins, and then to a Fair Value you can compare with today’s price. On Simply Wall St’s Community page, investors can choose or create a Narrative that spells out why they think BD will grow faster or slower, earn higher or lower margins, or deserve a richer or cheaper multiple, and the platform automatically turns that story into a full valuation that updates as new news, guidance or earnings arrive. Narratives present the relationship between your Fair Value and the current share price at a glance, and show how that gap changes as conditions evolve. For example, one BD Narrative might lean bullish, assuming successful execution of the 2026 business separation and a Fair Value closer to $270, while a more cautious Narrative might focus on trade and China risks and land nearer $183, providing a clear, dynamic framework to anchor your own decisions.

Do you think there's more to the story for Becton Dickinson? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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