Is Revvity's Share Price Rally Justified After Recent Partnerships and Acquisitions?

• Ever wonder if Revvity is currently undervalued, overpriced, or sitting in that perfect sweet spot for investors? Let's break down whether there's hidden value in the stock today.
• Revvity's share price has rebounded strongly in the past month, climbing 9.6%, and it gained 6.2% in the latest week. However, it remains down around 10% over the past year.
• Much of this momentum has followed high-profile partnerships and product launches in the life sciences space, which have attracted fresh attention and renewed optimism from analysts and industry insiders alike. Recent leadership changes and several notable acquisitions have also added to the buzz around potential for strategic growth.
• The current valuation score for Revvity stands at 2 out of 6. As we explore various valuation techniques, keep in mind there might be a smarter way to think about value that we'll reveal at the end of this article.

Revvity scores just 2/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: Revvity Discounted Cash Flow (DCF) Analysis

The Discounted Cash Flow (DCF) model is a fundamental approach to valuing a company by projecting its expected future cash flows and then discounting those predictions back to today’s dollars. This helps estimate the intrinsic worth of a business based on what it can actually generate for shareholders over time.

For Revvity, the DCF analysis begins with its most recent free cash flow, reported at $491.7 million. Analysts forecast steady growth, projecting free cash flow will reach approximately $758 million by the end of 2028. Looking out over a full decade, projections stretch to over $1 billion, but it is important to note that only the next five years are based directly on analyst estimates, while subsequent years are extrapolations.

All cash flows are calculated in US dollars. Using the 2 Stage Free Cash Flow to Equity model, the estimated intrinsic value for Revvity shares is $128.71. This suggests the stock is currently trading at an 18.9% discount compared to its estimated fair value, indicating meaningful upside potential for investors who believe in the accuracy of these forecasts and management’s ability to deliver on growth targets.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Revvity is undervalued by 18.9%. Track this in your watchlist or portfolio, or discover 921 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 Revvity.

Approach 2: Revvity Price vs Earnings (PE)

The Price-to-Earnings (PE) ratio is a widely used valuation metric for profitable companies, making it an appropriate choice for assessing Revvity. A company's PE ratio tells investors how much they are paying today for each dollar of earnings. Generally, higher growth prospects or lower risk profiles can justify a higher PE multiple, while slower growth or greater risks might call for a lower one.

Currently, Revvity has a PE ratio of 50.9x, which is very close to the peer average of 51.7x. This stands above the life sciences industry average of 35.9x, indicating that investors are willing to pay a premium for Revvity relative to other companies in the sector. However, industry and peer comparisons alone do not capture the full picture, as each business has a unique combination of profitability, growth potential, and market-specific risks.

This is where Simply Wall St’s proprietary "Fair Ratio" comes in. For Revvity, this value is currently 27.0x. The Fair Ratio reflects a holistic view, factoring in Revvity’s forecast growth rates, profit margin, industry conditions, company size, and specific risks. Unlike traditional benchmarks, the Fair Ratio aims to deliver a truer sense of whether the stock’s current valuation is justified based on fundamentals unique to Revvity. In this case, Revvity’s actual PE ratio is well above its Fair Ratio, highlighting that the stock appears overvalued on an earnings basis when accounting for these tailored factors.

Result: OVERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1438 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Revvity Narrative

Earlier we mentioned that there is an even better way to understand valuation. Let's introduce you to Narratives. A Narrative is a simple yet powerful way to capture your perspective about a company. Essentially, it's your story behind the numbers you believe matter most, such as fair value, future revenue, earnings, and profit margins.

Unlike traditional models that focus only on financial metrics, Narratives connect Revvity’s business story, such as new product launches, buyback programs, or shifting regulations, to a personalized financial forecast and then to your own estimate of fair value. It's an accessible tool that anyone can use, built right into Simply Wall St's Community page, and used by millions of investors seeking to make smarter decisions.

With Narratives, you can see at a glance whether Revvity's current price offers a buying or selling opportunity by comparing your fair value view to the market price. Plus, when important news, earnings releases, or other company updates are published, Narratives are refreshed automatically to reflect the latest outlook.

For example, some investors think Revvity could reach $162 per share if recurring high-margin software sales accelerate, while others believe it may only be worth $100 due to ongoing regulatory and market headwinds. This highlights how Narratives turn your unique insights into actionable decisions.

Do you think there's more to the story for Revvity? 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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