Mettler Toledo is scored 53 for moat and 80 for management. The management score rests on a return on invested capital of 35.5% and a gross margin of 57.5% — figures that describe a business turning capital into profit efficiently. Shareholder equity is negative, so the debt-to-equity figure is not meaningful here — usually the mark of heavy buybacks rather than distress, but worth checking. A moderate moat alongside exceptional management is a combination worth understanding before the price matters at all.
The valuation runs on assumptions chosen to understate rather than flatter. Growth is modelled at 5.5% a year, the rate measured from the filings. The exit multiple assumed is 10.9x. That produces an intrinsic value of $204.62, a 10-CAP price of $444.96 and a payback time price of $455.74, with the value zone set at the highest of the three, $455.74. Today's price of $1,481.17 is 225% above it.
The price is above the value zone and the business scores 53 for moat and 80 for management. Neither test argues for paying up here.
| Price | $1,481.17 |
| Market cap | $29.9B |
| P/E ratio | 33.3x |
| Return on invested capital | 35.5% |
| Gross margin | 57.5% |
| Debt to equity | -99.14x |
| Free cash flow yield | 3.0% |
| Growth rate used | 5.5% |
| Growth rate measured | 5.0% |
| Exit multiple assumed | 10.9x |
| Company | Moat | Buy price |
| Quest Diagnostics (DGX) | 62 | $123.77 |
| LabCorp (LH) | 42 | $158.56 |
| Illumina, Inc. (ILMN) | 48 | $67.65 |
| Idexx Laboratories (IDXX) | 97 | $197.94 |
Every number above is built on assumptions that can be changed. In Moatly you can move the growth rate, the exit multiple and the margin of safety and watch every figure recalculate, so you are testing your own view of Mettler Toledo rather than accepting ours.