.Enterprise Value to FCFF (EV/FCFF)
Difficulty: Intermediate
Free Cash Flow to The Firm (FCFF)
Apple Inc., FCFF calculation
USD $ in millions
| 12 months ended | Sep 30, 2017 | Sep 24, 2016 | Sep 26, 2015 | Sep 27, 2014 | Sep 28, 2013 | Sep 29, 2012 | |
|---|---|---|---|---|---|---|---|
| | Net income | ||||||
| | Net noncash charges | ||||||
| | Changes in operating assets and liabilities | ||||||
| | Cash generated by operating activities | ||||||
| | Cash paid for interest, net of tax1 | ||||||
| | Payments for acquisition of property, plant and equipment | ||||||
| | Payments for acquisition of intangible assets | ||||||
| | Free cash flow to the firm (FCFF) |
| Item | Description | The company |
|---|---|---|
| FCFF | Free cash flow to the firm is the cash flow available to the Apple Inc.'s suppliers of capital after all operating expenses have been paid and necessary investments in working and fixed capital have been made. | Apple Inc.'s FCFF declined from 2015 to 2016 and from 2016 to 2017. |
Interest Paid, Net of Tax
Apple Inc., interest paid, net of tax calculation
USD $ in millions
| 12 months ended | Sep 30, 2017 | Sep 24, 2016 | Sep 26, 2015 | Sep 27, 2014 | Sep 28, 2013 | Sep 29, 2012 | |
|---|---|---|---|---|---|---|---|
| Effective Income Tax Rate (EITR) | |||||||
| | EITR1 | % | % | % | % | % | % |
| Interest Paid, Net of Tax | |||||||
| | Cash paid for interest, before tax | ||||||
| | Less: Cash paid for interest, tax2 | ||||||
| | Cash paid for interest, net of tax | ||||||
2017 Calculations
2 Cash paid for interest, tax = Cash paid for interest × EITR
= × % =
Enterprise Value to FCFF Ratio, Current
Apple Inc., current EV/FCFF calculation, comparison to benchmarks
| Selected Financial Data (USD $ in millions) | |
| Enterprise value (EV) | |
| Free cash flow to the firm (FCFF) | |
| Ratio | |
| EV/FCFF | |
| Benchmarks | |
| EV/FCFF, Competitors | |
| Applied Materials Inc. | |
| Broadcom Ltd. | |
| Cisco Systems Inc. | |
| HP Inc. | |
| Intel Corp. | |
| NVIDIA Corp. | |
| Qualcomm Inc. | |
| Texas Instruments Inc. | |
| EV/FCFF, Sector | |
| Technology Hardware & Equipment | |
| EV/FCFF, Industry | |
| Technology | |
If company EV/FCFF is lower then the EV/FCFF of benchmark then company is relatively undervalued.
Otherwise, if company EV/FCFF is higher then the EV/FCFF of benchmark then company is relatively overvalued.
Enterprise Value to FCFF Ratio, Historical
Apple Inc., historical EV/FCFF calculation, comparison to benchmarks
| Sep 30, 2017 | Sep 24, 2016 | Sep 26, 2015 | Sep 27, 2014 | Sep 28, 2013 | Sep 29, 2012 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (USD $ in millions) | |||||||
| | Enterprise value (EV)1 | ||||||
| | Free cash flow to the firm (FCFF)2 | ||||||
| Ratio | |||||||
| | EV/FCFF3 | ||||||
| Benchmarks | |||||||
| EV/FCFF, Competitors | |||||||
| Applied Materials Inc. | |||||||
| Broadcom Ltd. | |||||||
| Cisco Systems Inc. | |||||||
| HP Inc. | |||||||
| Intel Corp. | |||||||
| NVIDIA Corp. | |||||||
| Qualcomm Inc. | |||||||
| Texas Instruments Inc. | |||||||
| EV/FCFF, Sector | |||||||
| Technology Hardware & Equipment | |||||||
| EV/FCFF, Industry | |||||||
| Technology | |||||||
2017 Calculations
3 EV/FCFF = EV ÷ FCFF
= ÷ =
| Ratio | Description | The company |
|---|---|---|
| EV/FCFF | Enterprise value to free cash flow to the firm is whole company valuation indicator. | Apple Inc.'s EV/FCFF ratio increased from 2015 to 2016 and from 2016 to 2017. |
