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Varian Medical Systems

NYSE:VAR
Snowflake Description

Flawless balance sheet with solid track record.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
VAR
NYSE
$12B
Market Cap
  1. Home
  2. US
  3. Healthcare
Company description

Varian Medical Systems, Inc. designs, manufactures, sells, and services medical devices and software products for treating cancer and other medical conditions worldwide. The last earnings update was 45 days ago. More info.


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VAR Share Price and Events
7 Day Returns
4.8%
NYSE:VAR
3.1%
US Medical Equipment
2.2%
US Market
1 Year Returns
15.9%
NYSE:VAR
16.3%
US Medical Equipment
3.8%
US Market
VAR Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
Varian Medical Systems (VAR) 4.8% 7.9% -1% 15.9% 71.3% 63.6%
US Medical Equipment 3.1% 8.3% 5.9% 16.3% 68.2% 100.9%
US Market 2.2% 3.4% 4.4% 3.8% 43% 40.9%
1 Year Return vs Industry and Market
  • VAR outperformed the Market in United States of America which returned 3.8% over the past year.
Price Volatility
VAR
Industry
5yr Volatility vs Market

VAR Value

 Is Varian Medical Systems undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of Varian Medical Systems to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for Varian Medical Systems.

NYSE:VAR Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 7 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 8.1%
Perpetual Growth Rate 10-Year US Government Bond Rate 2.7%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for NYSE:VAR
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year US Govt Bond Rate 2.7%
Equity Risk Premium S&P Global 6%
Medical Equipment Unlevered Beta Simply Wall St/ S&P Global 0.85
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 0.852 (1 + (1- 21%) (0%))
0.901
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
0.9
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 2.73% + (0.901 * 5.96%)
8.1%

Discounted Cash Flow Calculation for NYSE:VAR using 2 Stage Free Cash Flow to Equity Model

The calculations below outline how an intrinsic value for Varian Medical Systems is arrived at by discounting future cash flows to their present value using the 2 stage method. We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.

NYSE:VAR DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (USD, Millions) Source Present Value
Discounted (@ 8.1%)
2019 384.00 Analyst x1 355.23
2020 460.50 Analyst x2 394.08
2021 534.00 Analyst x1 422.74
2022 593.66 Est @ 11.17% 434.76
2023 644.95 Est @ 8.64% 436.93
2024 689.24 Est @ 6.87% 431.95
2025 728.02 Est @ 5.63% 422.07
2026 762.65 Est @ 4.76% 409.02
2027 794.29 Est @ 4.15% 394.07
2028 823.87 Est @ 3.72% 378.12
Present value of next 10 years cash flows $4,078.96
NYSE:VAR DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2028 × (1 + g) ÷ (Discount Rate – g)
= $823.87 × (1 + 2.73%) ÷ (8.1% – 2.73%)
$15,762.87
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= $15,762.87 ÷ (1 + 8.1%)10
$7,234.45
NYSE:VAR Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= $4,078.96 + $7,234.45
$11,313.41
Equity Value per Share
(USD)
= Total value / Shares Outstanding
= $11,313.41 / 90.95
$124.4
NYSE:VAR Discount to Share Price
Calculation Result
Value per share (USD) From above. $124.40
Current discount Discount to share price of $137.22
= -1 x ($137.22 - $124.40) / $124.40
-10.3%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

  • The current share price of Varian Medical Systems is above its future cash flow value.
Often investors are willing to pay a premium for a company that has a high dividend or the potential for future growth.
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for Varian Medical Systems's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are Varian Medical Systems's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
NYSE:VAR PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2019-03-29) in USD $4.18
NYSE:VAR Share Price ** NYSE (2019-06-21) in USD $137.22
United States of America Medical Equipment Industry PE Ratio Median Figure of 64 Publicly-Listed Medical Equipment Companies 41.58x
United States of America Market PE Ratio Median Figure of 3,093 Publicly-Listed Companies 17.88x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of Varian Medical Systems.

NYSE:VAR PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= NYSE:VAR Share Price ÷ EPS (both in USD)

= 137.22 ÷ 4.18

32.86x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Varian Medical Systems is good value based on earnings compared to the US Medical Equipment industry average.
  • Varian Medical Systems is overvalued based on earnings compared to the United States of America market.
Price based on expected Growth
Does Varian Medical Systems's expected growth come at a high price?
Raw Data
NYSE:VAR PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 32.86x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 7 Analysts
13.6%per year
United States of America Medical Equipment Industry PEG Ratio Median Figure of 56 Publicly-Listed Medical Equipment Companies 2.32x
United States of America Market PEG Ratio Median Figure of 2,133 Publicly-Listed Companies 1.54x

*Line of best fit is calculated by linear regression .

NYSE:VAR PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 32.86x ÷ 13.6%

2.41x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Varian Medical Systems is poor value based on expected growth next year.
Price based on value of assets
What value do investors place on Varian Medical Systems's assets?
Raw Data
NYSE:VAR PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2019-03-29) in USD $19.03
NYSE:VAR Share Price * NYSE (2019-06-21) in USD $137.22
United States of America Medical Equipment Industry PB Ratio Median Figure of 183 Publicly-Listed Medical Equipment Companies 4.6x
United States of America Market PB Ratio Median Figure of 5,254 Publicly-Listed Companies 1.81x
NYSE:VAR PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= NYSE:VAR Share Price ÷ Book Value per Share (both in USD)

= 137.22 ÷ 19.03

7.21x

* Primary Listing of Varian Medical Systems.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Varian Medical Systems is overvalued based on assets compared to the US Medical Equipment industry average.
X
Value checks
We assess Varian Medical Systems's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Medical Equipment industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Medical Equipment industry average (and greater than 0)? (1 check)
  5. Varian Medical Systems has a total score of 1/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

VAR Future Performance

 How is Varian Medical Systems expected to perform in the next 1 to 3 years based on estimates from 7 analysts?

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
13.6%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is Varian Medical Systems expected to grow at an attractive rate?
  • Varian Medical Systems's earnings growth is expected to exceed the low risk savings rate of 2.7%.
Growth vs Market Checks
  • Varian Medical Systems's earnings growth is positive but not above the United States of America market average.
  • Varian Medical Systems's revenue growth is expected to exceed the United States of America market average.
Annual Growth Rates Comparison
Raw Data
NYSE:VAR Future Growth Rates Data Sources
Data Point Source Value (per year)
NYSE:VAR Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 7 Analysts 13.6%
NYSE:VAR Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 7 Analysts 9%
United States of America Medical Equipment Industry Earnings Growth Rate Market Cap Weighted Average 21.9%
United States of America Medical Equipment Industry Revenue Growth Rate Market Cap Weighted Average 7.8%
United States of America Market Earnings Growth Rate Market Cap Weighted Average 14%
United States of America Market Revenue Growth Rate Market Cap Weighted Average 7.4%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
NYSE:VAR Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (2 months ago) See Below
Future Estimates Average of up to 7 Analyst Estimates (S&P Global) See Below
All numbers in USD Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
NYSE:VAR Future Estimates Data
Date (Data in USD Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2022-09-30 4,204 640 1
2021-09-30 3,742 609 520 5
2020-09-30 3,408 565 462 7
2019-09-30 3,138 521 415 7
NYSE:VAR Past Financials Data
Date (Data in USD Millions) Revenue Cash Flow Net Income *
2019-03-29 3,031 338 381
2018-12-28 2,982 417 365
2018-09-28 2,919 455 150
2018-06-29 2,839 476 112
2018-03-30 2,763 529 109
2017-12-29 2,696 496 106
2017-09-29 2,619 399 225
2017-06-30 2,645 421 241
2017-03-31 2,655 362 253
2016-12-30 2,607 361 260
2016-09-30 2,594 356 322
2016-07-01 2,692 358 330
2016-04-01 2,833 446 361

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • Varian Medical Systems's earnings are expected to grow by 13.6% yearly, however this is not considered high growth (20% yearly).
  • Varian Medical Systems's revenue is expected to grow by 9% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
NYSE:VAR Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (2 months ago) See Below
Future Estimates Average of up to 7 Analyst Estimates (S&P Global) See Below

All data from Varian Medical Systems Company Filings, last reported 2 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NYSE:VAR Future Estimates Data
Date (Data in USD Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2022-09-30 7.33 7.33 7.33 1.00
2021-09-30 5.71 6.29 5.24 3.00
2020-09-30 4.98 5.22 4.73 4.00
2019-09-30 4.48 4.81 4.27 4.00
NYSE:VAR Past Financials Data
Date (Data in USD Millions) EPS *
2019-03-29 4.18
2018-12-28 4.00
2018-09-28 1.64
2018-06-29 1.22
2018-03-30 1.19
2017-12-29 1.15
2017-09-29 2.44
2017-06-30 2.59
2017-03-31 2.70
2016-12-30 2.76
2016-09-30 3.37
2016-07-01 3.41
2016-04-01 3.69

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Varian Medical Systems is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).
X
Future performance checks
We assess Varian Medical Systems's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the United States of America market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the United States of America market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
Varian Medical Systems has a total score of 2/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

VAR Past Performance

  How has Varian Medical Systems performed over the past 5 years?

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare Varian Medical Systems's growth in the last year to its industry (Medical Equipment).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • Varian Medical Systems's year on year earnings growth rate was negative over the past 5 years, however the most recent earnings are above average.
  • Varian Medical Systems's 1-year earnings growth exceeds its 5-year average (248.8% vs -16%)
  • Varian Medical Systems's earnings growth has exceeded the US Medical Equipment industry average in the past year (248.8% vs 31.9%).
Earnings and Revenue History
Varian Medical Systems's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from Varian Medical Systems Company Filings, last reported 2 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NYSE:VAR Past Revenue, Cash Flow and Net Income Data
Date (Data in USD Millions) Revenue Net Income * G+A Expenses R&D Expenses
2019-03-29 3,031.10 380.80 567.80 239.40
2018-12-28 2,981.60 365.40 557.50 238.90
2018-09-28 2,919.10 149.90 539.30 233.90
2018-06-29 2,839.30 112.10 534.80 226.00
2018-03-30 2,763.00 109.20 514.20 221.60
2017-12-29 2,696.30 105.60 505.30 216.00
2017-09-29 2,619.30 225.30 537.20 210.00
2017-06-30 2,644.70 240.70 526.30 211.00
2017-03-31 2,654.80 252.80 535.30 207.00
2016-12-30 2,606.80 260.40 512.60 202.70
2016-09-30 2,593.70 321.90 472.20 200.40
2016-07-01 2,691.73 329.61 464.01 216.50
2016-04-01 2,832.84 361.32 447.63 225.41
2016-01-01 2,977.05 390.09 455.62 235.72
2015-10-02 2,490.70 310.90 428.80 195.40
2015-07-03 3,093.38 418.65 476.75 235.57
2015-04-03 3,057.05 412.24 490.07 232.55
2015-01-02 3,076.15 399.06 490.94 233.91
2014-09-26 3,049.80 403.70 469.90 234.80
2014-06-27 3,000.42 415.18 459.46 232.52
2014-03-28 2,978.95 420.93 437.62 228.87
2013-12-27 2,968.80 440.93 433.09 219.09
2013-09-27 2,942.90 438.25 431.08 208.21
2013-06-28 2,929.12 441.10 424.54 197.32
2013-03-29 2,908.16 437.11 426.83 192.93
2012-12-28 2,860.08 432.10 419.83 189.09
2012-09-28 2,807.02 427.05 416.52 185.74
2012-06-29 2,769.78 417.30 400.83 183.70

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • Varian Medical Systems has efficiently used shareholders’ funds last year (Return on Equity greater than 20%).
  • Varian Medical Systems used its assets more efficiently than the US Medical Equipment industry average last year based on Return on Assets.
  • Varian Medical Systems has improved its use of capital last year versus 3 years ago (Return on Capital Employed).
X
Past performance checks
We assess Varian Medical Systems's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Medical Equipment industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
Varian Medical Systems has a total score of 5/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

VAR Health

 How is Varian Medical Systems's financial health and their level of debt?

A company's financial position is much like your own financial position, it includes everything you own (assets) and owe (liabilities).

The boxes below represent the relative size of what makes up Varian Medical Systems's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • Varian Medical Systems is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
  • Varian Medical Systems's cash and other short term assets cover its long term commitments.
Balance sheet
This treemap shows a more detailed breakdown of Varian Medical Systems's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
  • High level of physical assets or inventory.
  • Varian Medical Systems has no debt, it does not need to be covered by short term assets.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from Varian Medical Systems Company Filings, last reported 2 months ago.

NYSE:VAR Past Debt and Equity Data
Date (Data in USD Millions) Total Equity Total Debt Cash & Short Term Investments
2019-03-29 1,740.10 0.00 546.30
2018-12-28 1,682.00 0.00 656.10
2018-09-28 1,588.70 0.00 544.20
2018-06-29 1,501.50 18.20 542.30
2018-03-30 1,456.60 255.00 746.00
2017-12-29 1,391.00 340.00 836.60
2017-09-29 1,521.90 350.00 716.20
2017-06-30 1,394.30 364.00 658.20
2017-03-31 1,292.60 546.50 705.50
2016-12-30 1,739.30 607.20 814.70
2016-09-30 1,754.50 665.90 906.70
2016-07-01 1,702.19 701.44 835.94
2016-04-01 1,703.87 794.14 961.10
2016-01-01 1,642.06 728.25 953.38
2015-10-02 1,726.30 495.90 845.50
2015-07-03 1,742.93 494.45 1,023.14
2015-04-03 1,678.32 512.50 932.30
2015-01-02 1,617.90 525.00 972.88
2014-09-26 1,616.42 437.50 915.45
2014-06-27 1,714.91 479.58 986.76
2014-03-28 1,679.02 468.75 1,018.44
2013-12-27 1,699.59 481.25 1,045.17
2013-09-27 1,713.85 506.25 1,180.56
2013-06-28 1,683.55 174.37 825.04
2013-03-29 1,627.87 238.12 795.87
2012-12-28 1,576.89 206.25 807.29
2012-09-28 1,509.78 161.25 754.28
2012-06-29 1,463.33 175.01 680.54
  • Varian Medical Systems has no debt.
  • Varian Medical Systems has no debt compared to 5 years ago when it was 27.9%.
  • Varian Medical Systems has no debt, it does not need to be covered by operating cash flow.
  • Varian Medical Systems has no debt, therefore coverage of interest payments is not a concern.
X
Financial health checks
We assess Varian Medical Systems's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. Varian Medical Systems has a total score of 6/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

VAR Dividends

 What is Varian Medical Systems's current dividend yield, its reliability and sustainability?

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
0%
Current annual income from Varian Medical Systems dividends. Estimated to be 0% next year.
If you bought $2,000 of Varian Medical Systems shares you are expected to receive $0 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • Unable to evaluate Varian Medical Systems's dividend yield against the bottom 25% of dividend payers as the company has not reported any payouts.
  • Unable to evaluate Varian Medical Systems's dividend against the top 25% market benchmark as the company has not reported any payouts.
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
NYSE:VAR Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 7 Analyst Estimates (S&P Global) See Below
United States of America Medical Equipment Industry Average Dividend Yield Market Cap Weighted Average of 24 Stocks 1.2%
United States of America Market Average Dividend Yield Market Cap Weighted Average of 2012 Stocks 2.4%
United States of America Minimum Threshold Dividend Yield 10th Percentile 0.8%
United States of America Bottom 25% Dividend Yield 25th Percentile 1.4%
United States of America Top 25% Dividend Yield 75th Percentile 3.7%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

NYSE:VAR Future Dividends Estimate Data
Date (Data in $) Dividend per Share (annual) Avg. No. Analysts
2022-09-30
2021-09-30 0.00 1.00
2020-09-30 0.00 2.00
2019-09-30 0.00 2.00

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Unable to perform a dividend volatility check as Varian Medical Systems has not reported any payouts.
  • Unable to verify if Varian Medical Systems's dividend has been increasing as the company has not reported any payouts.
Current Payout to shareholders
What portion of Varian Medical Systems's earnings are paid to the shareholders as a dividend.
  • Unable to calculate sustainability of dividends as Varian Medical Systems has not reported any payouts.
Future Payout to shareholders
  • No need to calculate the sustainability of Varian Medical Systems's dividends in 3 years as they are not expected to pay a notable one for United States of America.
X
Income/ dividend checks
We assess Varian Medical Systems's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 0.8%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can Varian Medical Systems afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. Varian Medical Systems has a total score of 0/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

VAR Management

 What is the CEO of Varian Medical Systems's salary, the management and board of directors tenure and is there insider trading?

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
Dow Wilson
COMPENSATION $10,276,439
AGE 59
TENURE AS CEO 6.8 years
CEO Bio

Mr. Dow R. Wilson has been the Chief Executive Officer and President of Varian Medical Systems, Inc. since September 29, 2012. Mr. Wilson has been a Director of Agilent Technologies, Inc. since March 20, 2018. Mr. Wilson served as the Chief Operating Officer and Corporate Executive Vice President of Varian Medical Systems Inc. from October 2011 to September 2012 and from August 2005 to September 2012 respectively. He served as the President of Oncology Systems at Varian Medical Systems Inc. from January 10, 2005 to September 2011 and served as its Corporate Vice President since joining in January 2005 until August 2005. Prior to joining the Varian Medical Systems, he served as the Chief Executive Officer of the Healthcare-Information Technologies business in General Electric Company or GEC from 2003 to 2005. Mr. Wilson has 19-year career with General Electric in a variety of senior management positions in both the United States and Europe. While at GEC, he also managed several large, global enterprises, including the CT (Cat Scanner), Xray and Functional Imaging Businesses. Mr. Wilson served as Chief Executive Officer of Patient Monitoring Technologies. Previously, he served as General Manager of Surgical, X-ray and Interventional Businesses and General Manager of Functional Imaging of the Healthcare-Information Technologies business at GEC from 2002 to 2003 and served as its General Manager of Computed Tomography of the Healthcare-Information Technologies business from 2000 to 2002. He was appointed to U.S. President’s Advisory Council on Doing Business in Africa in 2015 and completed a second term on the Council. He gained significant knowledge of domestic and international medical and healthcare industries. He served management positions at General Electric and critical insight into operational requirements of a company with worldwide reach, knowledge of corporate and business unit strategies and operational expertise, each gained from executive management experience at two large, global organizations. He was Director at Varex Imaging Corporation since January 27, 2017 until January 2018. He has been a Director of Varian Medical Systems, Inc. since September 29, 2012. He was a Director of Saba Software, Inc. since August 28, 2006 until March 2015 and served as its Lead Director from August 2011 to March 1, 2013. Mr. Wilson also serves on the board of directors of industry associations AdvaMed and the US-India Strategic Partner Forum. Mr. Wilson holds B.A. degree in English and business from Brigham Young University and an MBA degree from Dartmouth's Amos Tuck School of Business.

CEO Compensation
  • Dow's compensation has been consistent with company performance over the past year, both up more than 20%.
  • Dow's remuneration is about average for companies of similar size in United States of America.
Management Team Tenure

Average tenure and age of the Varian Medical Systems management team in years:

2.1
Average Tenure
53
Average Age
  • The tenure for the Varian Medical Systems management team is about average.
Management Team

Dow Wilson

TITLE
President
COMPENSATION
$10M
AGE
59
TENURE
6.8 yrs

Gary Bischoping

TITLE
Senior VP of Finance & CFO
COMPENSATION
$3M
AGE
50
TENURE
2.1 yrs

John Kuo

TITLE
Senior VP
COMPENSATION
$3M
AGE
55
TENURE
13.9 yrs

Kolleen Kennedy

TITLE
Chief Growth Officer & President of Proton Solutions
COMPENSATION
$4M
AGE
59

Kevin O’Reilly

TITLE
Senior Vice President of Global Operations
TENURE
0.2 yrs

Magnus Momsen

TITLE
Senior VP

Mike Bruff

TITLE
Senior Vice President of Investor Relations
AGE
49
TENURE
1.8 yrs

Mark Plungy

TITLE
Director of Public Relations

Rafael Torres

TITLE
Senior Vice President of Business Development and Strategy
TENURE
4.1 yrs

Terilyn Monroe

TITLE
Chief People Officer & Senior Vice President of People Places and Communications
AGE
51
TENURE
1.7 yrs
Board of Directors Tenure

Average tenure and age of the Varian Medical Systems board of directors in years:

5.3
Average Tenure
59
Average Age
  • The tenure for the Varian Medical Systems board of directors is about average.
Board of Directors

Andy Eckert

TITLE
Chairman
COMPENSATION
$445K
AGE
56
TENURE
5.3 yrs

Dow Wilson

TITLE
President
COMPENSATION
$10M
AGE
59
TENURE
6.8 yrs

Dave Illingworth

TITLE
Independent Director
COMPENSATION
$285K
AGE
64
TENURE
7.8 yrs

Regina Dugan

TITLE
Independent Director
COMPENSATION
$277K
AGE
55
TENURE
5.5 yrs

Judy Bruner

TITLE
Independent Director
COMPENSATION
$308K
AGE
59
TENURE
2.8 yrs

Jean-Luc Butel

TITLE
Independent Director
COMPENSATION
$286K
AGE
62
TENURE
2.3 yrs

Tim Guertin

TITLE
Director
COMPENSATION
$271K
AGE
68
TENURE
14.4 yrs

Jeff Balser

TITLE
Independent Director
AGE
55
TENURE
0.7 yrs

Anat Ashkenazi

TITLE
Independent Director
AGE
45
TENURE
0.5 yrs
Who owns this company?
Recent Insider Trading
  • No 3 month insider trading information.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price ($) Value ($)
X
Management checks
We assess Varian Medical Systems's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. Varian Medical Systems has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

VAR News

Simply Wall St News

Is Varian Medical Systems, Inc. (NYSE:VAR) Undervalued After Accounting For Its Future Growth?

This tells us that Varian Medical Systems is overvalued compared to the US market average ratio of 18x , and undervalued based on its latest annual earnings update compared to the Medical Equipment average of 41.6x. … But, seeing as Varian Medical Systems is perceived as a high-growth stock, we must also account for its earnings growth, which is captured in the PEG ratio. … A PE ratio of 32.66x and expected year-on-year earnings growth of 14% give Varian Medical Systems a quite high PEG ratio of 2.4x.

Simply Wall St -

Does Varian Medical Systems, Inc.'s (NYSE:VAR) Stock Price Account For Its Growth?

This illustrates that Varian Medical Systems is overvalued compared to the US market average ratio of 18x , and undervalued based on its latest annual earnings update compared to the Medical Equipment average of 41.6x. … However, seeing as Varian Medical Systems is perceived as a high-growth stock, we must also account for its earnings growth, which is captured in the PEG ratio. … A PE ratio of 32.66x and expected year-on-year earnings growth of 14% give Varian Medical Systems a quite high PEG ratio of 2.4x.

Simply Wall St -

A Holistic Look At Varian Medical Systems, Inc. (NYSE:VAR)

For those interested in understanding where the figures come from and want to see the analysis, take a look at the report on Varian Medical Systems here. … NYSE:VAR Income Statement, June 10th 2019 Next Steps: For Varian Medical Systems, I've compiled three pertinent factors you should look at: Future Outlook: What are well-informed industry analysts predicting for VAR’s future growth? … Take a look at our free research report of analyst consensus for VAR’s outlook.

Simply Wall St -

Is Varian Medical Systems, Inc.'s (NYSE:VAR) Liquidity Good Enough?

See our latest analysis for Varian Medical Systems Can VAR service its debt comfortably? … The good news for investors is that Varian Medical Systems has no debt. … Given zero long-term debt on its balance sheet, Varian Medical Systems has no solvency issues, which is used to describe the company’s ability to meet its long-term obligations.

Simply Wall St -

Does This Valuation Of Varian Medical Systems, Inc. (NYSE:VAR) Imply Investors Are Overpaying?

We assume companies with shrinking free cash flow are will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. … A DCF is all about the idea that a dollar in the future is less valuable than a dollar today, and so the sum of these future cash flows is then discounted to today's value: 10-year free cash flow (FCF) forecast 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 Levered FCF ($, Millions) $443.57 $486.86 $534.00 $572.92 $606.84 $636.95 $664.30 $689.71 $713.82 $737.13 Growth Rate Estimate Source Analyst x3 Analyst x3 Analyst x1 Est @ 7.29% Est @ 5.92% Est @ 4.96% Est @ 4.29% Est @ 3.82% Est @ 3.5% Est @ 3.27% Present Value ($, Millions) Discounted @ 8.27% $409.67 $415.29 $420.69 $416.85 $407.78 $395.31 $380.78 $365.12 $349.01 $332.86 Present Value of 10-year Cash Flow (PVCF)= $3.89b "Est" = FCF growth rate estimated by Simply Wall St The second stage is also known as Terminal Value, this is the business's cash flow after the first stage. … NYSE:VAR Intrinsic value, May 13th 2019 Important assumptions We would point out that the most important inputs to a discounted cash flow are the discount rate and of course the actual cash flows.

Simply Wall St -

Varian Medical Systems, Inc. (NYSE:VAR): What We Can Expect From This Growth Stock

Help shape the future of investing tools and you could win a $250 gift card! … Based on Varian Medical Systems, Inc.'s (NYSE:VAR) earnings update on 29 March 2019, … with earnings expected to grow by 16% in the upcoming year

Simply Wall St -

How Should Investors React To Varian Medical Systems, Inc.'s (NYSE:VAR) CEO Pay?

This report will, first, examine the CEO compensation levels in comparison to CEO compensation at other big companies. … How Does Dow Wilson's Compensation Compare With Similar Sized Companies. … is worth US$12b, and total annual CEO compensation is US$10m.

Simply Wall St -

Do You Like Varian Medical Systems, Inc. (NYSE:VAR) At This P/E Ratio?

Varian Medical Systems has a price to earnings ratio of 35.19, based on the last twelve months. … How Do I Calculate Varian Medical Systems's Price To Earnings Ratio … Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS)

Simply Wall St -

Is Varian Medical Systems, Inc.'s (NYSE:VAR) 22% ROE Better Than Average?

We'll use ROE to examine Varian Medical Systems, Inc. … Over the last twelve months Varian Medical Systems has recorded a ROE of 22%. … Return on Equity = Net Profit ÷ Shareholders' Equity

Simply Wall St -

Are Varian Medical Systems, Inc.’s (NYSE:VAR) High Returns Really That Great?

Specifically, we're going to calculate its Return On Capital Employed (ROCE), in the hopes of getting some insight into the business. … Return On Capital Employed (ROCE): What is it? … The formula for calculating the return on capital employed is:

Simply Wall St -

VAR Company Info

Description

Varian Medical Systems, Inc. designs, manufactures, sells, and services medical devices and software products for treating cancer and other medical conditions worldwide. It operates through two segments, Oncology Systems and Proton Solutions. The Oncology Systems segment offers hardware and software products for treating cancer with radiotherapy, fixed field intensity-modulated radiation therapy, image-guided radiation therapy, volumetric modulated arc therapy, stereotactic radiosurgery, stereotactic body radiotherapy, and brachytherapy, as well as related quality assurance equipment. Its products include linear accelerators, brachytherapy after loaders, treatment accessories, and quality assurance software; and information management, treatment planning, image processing, clinical knowledge exchange, patient care management, decision-making support, and practice management software. This segment serves university research and community hospitals, private and governmental institutions, healthcare agencies, physicians’ offices, medical oncology practices, radiotherapy centers, and cancer care clinics. The Proton Solutions segment designs, develops, manufactures, sells, and services products and systems for delivering proton therapy for the treatment of cancer. Varian Medical Systems, Inc. has a strategic partnership with Siemens AG to co-develop new imaging and treatment solutions; and a strategic cooperation framework agreement with Shandong Cancer Hospital for proton therapy clinical application and research in China. The company was formerly known as Varian Associates, Inc. and changed its name to Varian Medical Systems, Inc. in April 1999. Varian Medical Systems, Inc. was founded in 1948 and is headquartered in Palo Alto, California.

Details
Name: Varian Medical Systems, Inc.
VAR
Exchange: NYSE
Founded: 1948
$12,479,575,403
90,945,747
Website: http://www.varian.com
Address: Varian Medical Systems, Inc.
3100 Hansen Way,
Palo Alto,
California, 94304,
United States
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
NYSE VAR Common Stock New York Stock Exchange US USD 02. Jan 1968
DB VNM Common Stock Deutsche Boerse AG DE EUR 02. Jan 1968
LSE 0LNU Common Stock London Stock Exchange GB USD 02. Jan 1968
BMV VAR * Common Stock Bolsa Mexicana de Valores MX MXN 02. Jan 1968
Number of employees
Current staff
Staff numbers
7,174
Varian Medical Systems employees.
Industry
Health Care Equipment
Healthcare
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2019/06/22 23:43
End of day share price update: 2019/06/21 00:00
Last estimates confirmation: 2019/06/14
Last earnings filing: 2019/05/08
Last earnings reported: 2019/03/29
Last annual earnings reported: 2018/09/28


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.