MeritValue

WEST PHARMACEUTICAL SERVICES INC

WSTdata completeness 100%18 fiscal years on file
The thesis, from the filings

WEST PHARMACEUTICAL SERVICES INC earns about 23% on invested capital, far above its ~9% cost of capital, and has bought back 5% of its shares over 5 years — the marks of a durable business run for its owners. The estimate methods put fair value between $83.51 and $141.34 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$2.83B1$2.89B2$2.95B3$2.89B3$3.07B3
Net income$661.8M4$585.9M5$593.4M6$492.7M6$493.7M6
Operating cash flow$584M7$724M8$776.5M9$653.4M9$754.8M9
Capital expenditure$253.4M10$284.6M11$362M12$377M12$285.9M12
Free cash flow (derived)$330.6M7$439.4M8$414.5M9$276.4M9$468.9M9
Total debt$506M13$417.8M14$413.6M15$405.2M16$405.6M16
Cash & equivalents$762.6M17$894.3M18$853.9M19$484.6M20$791.3M20
Diluted shares76.3M75.8M75.3M73.7M72.7M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$436.86
your share of equity
Profit it earned you last year
$67.91
Free cash flow it threw off
$64.5
Debt you’d be carrying
$55.79

10 shares is a claim on $436.86 of net worth that earned you $67.91 and generated $64.5 of cash last year, against $55.79 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
23% avg · 5y
FY21 31%FY22 26%FY23 24%FY24 19%FY25 18%

It earned about 23% on invested capital, year after year, against a ~9% cost of capital — the footprint of real pricing power. Competition usually drags returns like this back down; here it hasn't.

seeing a moat in the numbers →
Management signal · capital allocation
−5% shares · 5y

Share count is down 5% over 5 years — management has been buying back stock, quietly handing owners a bigger slice. Total debt has fallen 20% — deleveraging.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $83.51 and $141.34 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$141.34
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth7.8%
  • fcfBase$414.5M
DCF · Growth Exit 5Y
$119.33
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth7.8%
  • fcfBase$414.5M
Earnings Power Value
$83.51
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$585.9M
  • growthAssumed0.0%
Graham Number
$81.7
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years7.8%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $119.33
The three cases
Bear0.0%$86.77
Base7.8%$119.33
Bull12.8%$145.36

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 7.8%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0000105770-24-000015 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0000105770-25-000013 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0000105770-26-000010 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0000105770-24-000015 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0000105770-25-000013 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0000105770-26-000010 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0000105770-24-000015 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0000105770-25-000013 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0000105770-26-000010 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0000105770-24-000015 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-12-31 · accession 0000105770-25-000013 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0000105770-26-000010 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0000105770-23-000012 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2022-12-31 · accession 0000105770-24-000015 (LongTermDebtNoncurrent)
  15. 10-K · period ending 2023-12-31 · accession 0000105770-25-000013 (LongTermDebtNoncurrent)
  16. 10-K · period ending 2024-12-31 · accession 0000105770-26-000010 (LongTermDebtNoncurrent)
  17. 10-K · period ending 2021-12-31 · accession 0000105770-23-000012 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2022-12-31 · accession 0000105770-24-000015 (CashAndCashEquivalentsAtCarryingValue)
  19. 10-K · period ending 2023-12-31 · accession 0000105770-25-000013 (CashAndCashEquivalentsAtCarryingValue)
  20. 10-K · period ending 2024-12-31 · accession 0000105770-26-000010 (CashAndCashEquivalentsAtCarryingValue)