BioGaia sells clinically-documented Lactobacillus reuteri probiotics (drops, tablets) through a B2B2C licensing + own-brand model. The economics are outstanding: ~70% gross margin, ROIC ~60% on a tiny operating capital base, net cash ~SEK 0.8bn and a wide economic-profit spread (+SEK ~279m). FY2025 revenue rose ~8% reported (~14% organic; FX masked underlying demand).
It is a quality compounder, but fully valued: ~37x trailing P/E and ~28x EV/EBIT capitalize the strain documentation, brand and distribution. The watch items are a reinvestment year's margin step-down and the long-run durability of the strain/brand advantage. Own the quality on weakness, not here.
At ~37x P/E and ~28x EV/EBIT a quality premium is warranted, but the multiple already pays for the moat and growth — no margin of safety.
Base SEK 120 (quality-at-a-price; modest re-rate as organic growth resumes); bull SEK 150 if organic growth re-accelerates and margin recovers; bear SEK 95 on a multiple de-rate or strain/brand erosion.
The market pays today’s enterprise value for roughly 25.7% NOPAT growth over 5 years. The business earns 60% on capital against a 9% cost of capital (spread +51.2 pp); the no-growth value is SEK 52/share (43% of price), so the rest is priced-in growth.
| Scenario | 24m target | Impl. g | Upside | Prob. | Driver |
|---|---|---|---|---|---|
| Bull | SEK 150 | +32% | +23% | 30% | Organic growth re-accelerates; margin recovers |
| Base | SEK 120 | +25% | -2% | 45% | Quality-at-a-price; modest re-rate |
| Bear | SEK 95 | +18% | -22% | 25% | Multiple de-rate or strain/brand erosion |
| Prob-weighted | SEK 123 | — | +0% | 100% | Scenario-weighted expected value |
| WACC \ g | 0% | 3% | 5% | 8% | 10% | 15% |
|---|---|---|---|---|---|---|
| 7.50% | 65 | 73 | 78 | 87 | 94 | 112 |
| 8.25% | 58 | 64 | 69 | 77 | 82 | 97 |
| 9.00% (base) | 52 | 58 | 62 | 68 | 73 | 86 |
| 9.75% | 48 | 53 | 56 | 62 | 66 | 77 |
| 10.50% | 44 | 48 | 51 | 56 | 60 | 70 |
Green = fair value above the current price of SEK 122.30. The reverse-DCF conclusion is dominated by WACC and growth — see the whole surface, not a single fair value.
⤓ Download the full model (.xlsx) — formula-driven sheets; flex the blue input cells and the model cascades in Excel.
Clinically-backed strains + trusted brand drive pricing power and partner stickiness.
~14% organic FY2025; geographic + indication expansion is the engine.
ROIC ~60%, net cash — minimal capital needed to grow.
A reinvestment-year margin step-down reversing lifts earnings.
BioGaia is a best-in-class, net-cash, ~60%-ROIC probiotics franchise — but at ~37x P/E it is priced for its quality with no cushion. HOLD; base SEK 120.
Accumulate on a meaningful pullback; the durability of the strain/brand moat is what you are buying.
Every adjustment traces to the cited note/page in the source filing — click to open it there. Source reports archived locally.
| Adjustment / figure | Value | Source | Why mttssn treats it this way |
|---|---|---|---|
| Net sales | 1,538 | Consolidated statement of comprehensive income / Note 1 | Net sales Jan-Dec 2025 = 1,538,168 (SEK 000s) -> 1,538.168m; prior year 1,422,718. Note 1 (p. 13) confirms by segment (Pediatrics 1,154.012, Adult Health 372.533, Other 11.623) and geography (APAC 411.892, EMEA 497.306, Americas 628.970). |
| Cost of sales / gross profit | 1,129 | Consolidated statement of comprehensive income | Net sales 1,538,168 less cost of sales -409,587 = gross profit 1,128,581 (SEK 000s) -> 1,128.581m; gross margin 73.4% (company states 73%, p. 7). |
| Operating profit (EBIT) | 412 | Consolidated statement of comprehensive income | Operating profit line = 412,467 (SEK 000s) -> 412.467m (prior year 423,371). Used directly as adjusted EBIT - the company states there were no items affecting comparability in FY2025 (p. 7), so reported EBIT = adjusted EBIT. |
| Tax expense | -88.455 | Consolidated statement of comprehensive income | Tax -88,455 (SEK 000s) on profit before tax 421,220 = effective rate 21.0% (company states 21%, p. 7). Statutory 20.6% used for NOPAT per methodology. |
| Profit for the period (net income) | 333 | Consolidated statement of comprehensive income | Profit for the period 332,764 (SEK 000s) -> 332.764m, all attributable to owners of the parent (NCI 0); EPS 3.29. (Third-party aggregators quoting ~364m are inconsistent with the audited report.) |
| Depreciation and amortization | 24.666 | Consolidated cash flow statement | Depreciation/amortization add-back in operating cash flow = 24,666 (SEK 000s) -> 24.666m. FY2024 figure of 76,695 was inflated by the MetaboGen impairment; FY2025 D&A is the clean run-rate. |
| Operating cash flow / FCF base | 307 | Consolidated cash flow statement | Cash flow from operating activities Jan-Dec 2025 = 306,566 (SEK 000s). Less capex: PPE -3,524 + intangibles -75 = -3,599 -> free cash flow 302.967m. |
| Cash and cash equivalents | 801 | Consolidated balance sheet | Cash and cash equivalents at 31 Dec 2025 = 801,310 (SEK 000s) -> 801.310m (prior year 1,223,984; the drop reflects the SEK 698.0m dividend). 30.763 (~2% of revenue) retained as operational cash; 770.547 treated as excess and stripped from IC. |
| Interest-bearing debt | 0 | Consolidated balance sheet (Equity and liabilities) | The condensed balance sheet shows NO borrowings from credit institutions or bonds. Liabilities comprise deferred tax liability 4,957, non-current liabilities 79,489 and current liabilities 199,139 (which embed IFRS 16 lease liabilities and trade payables, not financial debt). BioGaia is financial-debt-free. |
| Total equity | 1,314 | Consolidated balance sheet / Statement of changes in equity (p.12) | Total equity at 31 Dec 2025 = 1,314,221 (SEK 000s) -> 1,314.221m; to parent 1,314,219, NCI 2 (SEK thousand). Roll-forward (p. 12): opening 1,723,934 + comprehensive income 290,940 - dividend 698,020 - Foundation provision 5,000 + share-based payments 2,367 = 1,314,221. |
| Right-of-use assets (lease proxy) | 22.932 | Consolidated balance sheet | Right-of-use assets = 22,932 (SEK 000s) -> 22.932m (1.4% of total assets 1,597,807). Lease liabilities are embedded in non-current/current liabilities and not separately itemised; treated as immaterial and excluded from IC (asset-light, manufacturing outsourced). |
| Shares outstanding / EPS | 101 | Consolidated statement of comprehensive income (per-share lines) | Number of shares = 101,162 thousand -> 101.162m (before and after dilution); EPS 3.29 = profit 332,764 / 101,162. Unchanged in the Q1 2026 statement (p. 2). Used for market cap with verified close SEK 122.30. |
| Net financial items | 8.752 | Consolidated statement of comprehensive income | Financial income 17,198 less financial expenses 8,446 = net +8,752 (SEK 000s) -> +8.752m; includes a SEK -2.4m remeasurement of the Nutraceutics earn-out. Sits below EBIT, so excluded from operating NOPAT. |
How the mttssn view has evolved — each prior dated note is preserved.