Risk Analysis: Is Viatris Inc. a Value Trap or Safe to Buy?
NMS · Healthcare · Drug Manufacturers - Specialty & Generic
Is Viatris Inc. a safe investment right now?
Viatris Inc.'s Altman Z-Score of 1.11 places it in the distress zone. Our DCF model estimates intrinsic value at $41.00, suggesting the stock may be undervalued by 64%. Moat rating: 2.8/5 stars.
Could Viatris Inc. go bankrupt? Altman Z-Score analysis
Z-Score of 1.11 falls below the 1.8 distress threshold, indicating significant financial stress.
- Below 1.8 — Distress Zone (high bankruptcy risk)
- 1.8 to 3.0 — Gray Zone (elevated uncertainty)
- Above 3.0 — Safe Zone (financially healthy)
What drives VTRS's Z-Score?
| Component | Formula | Value | Weight | Contribution |
|---|---|---|---|---|
| A · Working Capital / Total Assets | WC / TA | 0.0901 | 1.2 | 0.11 |
| B · Retained Earnings / Total Assets | RE / TA | 0.0824 | 1.4 | 0.12 |
| C · EBIT / Total Assets | EBIT / TA | 0.0185 | 3.3 | 0.06 |
| D · Market Cap / Total Liabilities | MCap / TL | 0.7573 | 0.6 | 0.45 |
| E · Revenue / Total Assets | Rev / TA | 0.3708 | 1.0 | 0.37 |
How has VTRS's financial health changed over time?
| Year | Z-Score | Zone |
|---|---|---|
| 2020 | 1.31 | Distress |
| 2021 | 0.66 | Distress |
| 2022 | 0.62 | Distress |
| 2023 | 0.95 | Distress |
| 2024 | 1.1 | Distress |
| 2025 | 1.11 | Distress |
Source: Calculated from VTRS's latest 10-K filing on SEC EDGAR.
What is Viatris Inc. actually worth?
What assumptions go into this valuation?
| Parameter | Value | Source |
|---|---|---|
| FCF Growth Rate (Stage 1) | 8.3% | 70% analyst consensus + 30% historical |
| Analyst EPS Growth (This Year) | 3.7% | Consensus (9 analysts) |
| Analyst EPS Growth (Next Year) | 9.5% | Consensus |
| Historical 5Y FCF CAGR | 12.2% | SEC EDGAR |
| Terminal Growth Rate | 2.5% | Long-term GDP proxy |
| Discount Rate (WACC) | 7.0% | CAPM (Rf=4.3% + 0.82*5.5%) |
| Net Cash / (Debt) | $-13,185M | Balance sheet |
| Base FCF (TTM) | $2.4B | Trailing 12 months |
| Shares Outstanding | 1,164,420,909 | Latest |
How sensitive is the valuation to growth rate changes?
| Growth Rate | 8% WACC | 10% WACC | 7.0% WACC | 13% WACC |
|---|---|---|---|---|
| 0% | $33.61 | $24.84 | $40.91 | $17.92 |
| 2.5% | $38.92 | $28.54 | $47.56 | $20.38 |
| 5.0% | $45.00 | $32.76 | $55.21 | $23.18 |
| 7.5% | $53.29 | $38.43 | $65.73 | $26.85 |
What does VTRS's free cash flow history look like?
| Year | FCF | Growth |
|---|---|---|
| 2020 | $2.1B | — |
| 2021 | $1.6B | +-23.9% |
| 2022 | $1.0B | +-37.8% |
| 2023 | $2.6B | +158.9% |
| 2024 | $2.6B | +1.3% |
| 2025 | $2.5B | +-2.7% |
Source: FCF data from SEC EDGAR filings. Price via Yahoo Finance.
Does Viatris Inc. have a durable competitive advantage?
Moat rating: 2.8/5.
What makes up VTRS's moat score?
ROIC Stability
ROIC variability over the past decade. Score: 1/5.
Gross Margin Trend
Gross margin trajectory over the past decade. Score: 5/5.
Switching Costs
Estimated customer lock-in based on margin level. Score: 3/5.
How stable is VTRS's return on invested capital?
| Year | ROIC | Trend |
|---|---|---|
| 2020 | 3.5% | — |
| 2021 | 1.4% | Declining |
| 2022 | -0.5% | Declining |
| 2023 | -0.1% | Stable |
| 2024 | 4.0% | Rising |
| 2025 | 2.1% | Declining |
Source: ROIC calculated from SEC EDGAR filings.
Is Viatris Inc.'s dividend safe?
Can Viatris Inc. afford its dividend?
Payout ratio is 960.0%. FCF covers the dividend 0.0x. 28 consecutive years of payments.
Viatris Inc.'s key financial metrics
| Metric | Latest | 1Y Ago | 3Y Ago | Trend |
|---|---|---|---|---|
| Revenue | $15.4B | $16.2B | $11.8B | Rising |
| Net Income | $0.0B | N/A | N/A | — |
| Free Cash Flow | $2.5B | $2.6B | $1.0B | Rising |
| Gross Margin | 41.8% | 40.1% | 32.1% | Rising |
Common questions about Viatris Inc.
Is Viatris Inc. at risk of going bankrupt?
Viatris Inc.'s Altman Z-Score of 1.11 places it in the distress zone. This metric uses balance sheet ratios to predict bankruptcy probability within 2 years. A score below 1.8 signals distress, while above 3.0 indicates safety.
What is Viatris Inc.'s intrinsic value based on DCF?
Our DCF model estimates Viatris Inc.'s intrinsic value at $41.00 per share. The current margin of safety is 63.7%. This estimate is based on historical free cash flow trends and a risk-adjusted discount rate.
Does Viatris Inc. have a competitive moat?
Viatris Inc. receives a moat rating of 2.8 out of 5 stars, based on ROIC stability, gross margin trends, and estimated switching costs. A rating above 3.5 suggests a durable competitive advantage.
Is Viatris Inc.'s dividend safe?
Our dividend safety analysis examines payout ratio, free cash flow coverage, and the company's streak of consecutive dividend payments to determine whether the current payout is sustainable.
Important disclaimer
This is not financial advice. All data is sourced from SEC EDGAR public filings. Always consult a qualified financial advisor before making investment decisions.
Last updated: Apr 20, 2026. Data may not reflect the most recent quarter if SEC filings have not yet been processed.
VTRS analysis methodology: How we calculate fair value, Z-Scores, and moat ratings