Stock Analysis on Net
Stock Analysis on Net
Microsoft Excel LibreOffice Calc

Biogen Inc. (NASDAQ:BIIB)

This company was transferred to the archive: financial data is no longer updated!

Economic Value Added (EVA)

Advanced level

EVA is registered trademark of Stern Stewart.

Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.

Economic Profit

Biogen Inc., economic profit calculation

US$ in thousands

Microsoft Excel LibreOffice Calc
12 months ended: Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Net operating profit after taxes (NOPAT)1 6,023,385  4,662,998  2,889,953  3,625,354  3,558,827 
Cost of capital2 12.68% 12.86% 12.84% 12.56% 12.62%
Invested capital3 14,142,400  13,170,638  12,477,279  12,901,026  11,109,890 
 
Economic profit4 4,230,592  2,969,824  1,287,285  2,005,023  2,157,034 

Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-06), 10-K (filing date: 2018-02-01), 10-K (filing date: 2017-02-02), 10-K (filing date: 2016-02-03).

1 NOPAT. See details »

2 Cost of capital. See details »

3 Invested capital. See details »

4 2019 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= 6,023,385 – 12.68% × 14,142,400 = 4,230,592

Item Description The company
Economic profit Economic profit is a measure of corporate performance computed by taking the spread between the return on invested capital and the cost of capital, and multiplying by the invested capital. Biogen Inc.’s economic profit increased from 2017 to 2018 and from 2018 to 2019.

Net Operating Profit after Taxes (NOPAT)

Biogen Inc., NOPAT calculation

US$ in thousands

Microsoft Excel LibreOffice Calc
12 months ended: Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Net income attributable to Biogen Inc. 5,888,500  4,430,700  2,539,100  3,702,800  3,547,000 
Deferred income tax expense (benefit)1 67,100  108,300  91,700  (175,000) (145,600)
Increase (decrease) in reserves for allowances2 5,800  (11,300) (5,200) (6,700) 8,800 
Increase (decrease) in restructuring reserve3 —  (500) (4,600) (32,200) 37,300 
Increase (decrease) in equity equivalents4 72,900  96,500  81,900  (213,900) (99,500)
Interest expense 187,400  200,600  250,800  260,000  95,500 
Interest expense, operating lease liability5 15,562  20,486  20,536  23,253  24,796 
Adjusted interest expense 202,962  221,086  271,336  283,253  120,296 
Tax benefit of interest expense6 (42,622) (46,428) (94,968) (99,139) (42,104)
Adjusted interest expense, after taxes7 160,340  174,658  176,368  184,114  78,192 
(Gain) loss on marketable securities (4,500) 8,500  19,400  1,000  2,000 
Interest income (120,000) (112,500) (78,500) (63,400) (22,100)
Investment income, before taxes (124,500) (104,000) (59,100) (62,400) (20,100)
Tax expense (benefit) of investment income8 26,145  21,840  20,685  21,840  7,035 
Investment income, after taxes9 (98,355) (82,160) (38,415) (40,560) (13,065)
Net income (loss) attributable to noncontrolling interest —  43,300  131,000  (7,100) 46,200 
Net operating profit after taxes (NOPAT) 6,023,385  4,662,998  2,889,953  3,625,354  3,558,827 

Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-06), 10-K (filing date: 2018-02-01), 10-K (filing date: 2017-02-02), 10-K (filing date: 2016-02-03).

1 Elimination of deferred tax expense. See details »

2 Addition of increase (decrease) in reserves for allowances.

3 Addition of increase (decrease) in restructuring reserve.

4 Addition of increase (decrease) in equity equivalents to net income attributable to Biogen Inc..

5 2019 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= 486,300 × 3.20% = 15,562

6 2019 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= 202,962 × 21.00% = 42,622

7 Addition of after taxes interest expense to net income attributable to Biogen Inc..

8 2019 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= 124,500 × 21.00% = 26,145

9 Elimination of after taxes investment income.

Item Description The company
NOPAT Net operating profit after taxes is income from operations, but after removement of taxes calculated on cash basis that are relevant to operating income. Biogen Inc.’s NOPAT increased from 2017 to 2018 and from 2018 to 2019.

Cash Operating Taxes

Biogen Inc., cash operating taxes calculation

US$ in thousands

Microsoft Excel LibreOffice Calc
12 months ended: Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Income tax expense 1,158,000  1,425,600  2,458,700  1,237,300  1,161,600 
Less: Deferred income tax expense (benefit) 67,100  108,300  91,700  (175,000) (145,600)
Add: Tax savings from interest expense 42,622  46,428  94,968  99,139  42,104 
Less: Tax imposed on investment income 26,145  21,840  20,685  21,840  7,035 
Cash operating taxes 1,107,377  1,341,888  2,441,283  1,489,599  1,342,269 

Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-06), 10-K (filing date: 2018-02-01), 10-K (filing date: 2017-02-02), 10-K (filing date: 2016-02-03).

Item Description The company
Cash operating taxes Cash operating taxes are estimated by adjusting income tax expense for changes in deferred taxes and tax benefit from the interest deduction. Biogen Inc.’s cash operating taxes decreased from 2017 to 2018 and from 2018 to 2019.

Invested Capital

Biogen Inc., invested capital calculation (financing approach)

US$ in thousands

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Current portion of notes payable 1,495,800  —  3,200  4,700  4,800 
Notes payable, excluding current portion 4,459,000  5,936,500  5,935,000  6,512,700  6,521,500 
Operating lease liability1 486,300  508,338  509,579  542,026  577,990 
Total reported debt & leases 6,441,100  6,444,838  6,447,779  7,059,426  7,104,290 
Total Biogen Inc. shareholders’ equity 13,343,200  13,039,600  12,612,800  12,140,100  9,372,800 
Net deferred tax (assets) liabilities2 (421,300) (517,700) (473,200) (581,700) (328,900)
Reserves for allowances3 40,500  34,700  46,000  51,200  57,900 
Restructuring reserve4 —  —  500  5,100  37,300 
Equity equivalents5 (380,800) (483,000) (426,700) (525,400) (233,700)
Accumulated other comprehensive (income) loss, net of tax6 135,200  240,400  318,400  319,900  224,000 
Noncontrolling interests (4,100) (8,000) (14,700) (11,500) 2,100 
Adjusted total Biogen Inc. shareholders’ equity 13,093,500  12,789,000  12,489,800  11,923,100  9,365,200 
Construction in progress7 (2,084,400) (1,758,500) (1,276,000) (658,600) (441,200)
Marketable securities8 (3,307,800) (4,304,700) (5,184,300) (5,422,900) (4,918,400)
Invested capital 14,142,400  13,170,638  12,477,279  12,901,026  11,109,890 

Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-06), 10-K (filing date: 2018-02-01), 10-K (filing date: 2017-02-02), 10-K (filing date: 2016-02-03).

1 Addition of capitalized operating leases.

2 Elimination of deferred taxes from assets and liabilities. See details »

3 Addition of allowance for doubtful accounts receivable.

4 Addition of restructuring reserve.

5 Addition of equity equivalents to total Biogen Inc. shareholders’ equity.

6 Removal of accumulated other comprehensive income.

7 Subtraction of construction in progress.

8 Subtraction of marketable securities.

Item Description The company
Invested capital Capital is an approximation of the economic book value of all cash invested in going-concern business activities. Biogen Inc.’s invested capital increased from 2017 to 2018 and from 2018 to 2019.

Cost of Capital

Biogen Inc., cost of capital calculations

Capital (fair value)1 Weights Cost of capital
Equity2 58,701,347  58,701,347  ÷ 65,741,247  = 0.89 0.89 × 13.82% = 12.34%
Notes payable and other financing arrangements, including current portion3 6,553,600  6,553,600  ÷ 65,741,247  = 0.10 0.10 × 4.02% × (1 – 21.00%) = 0.32%
Operating lease liability4 486,300  486,300  ÷ 65,741,247  = 0.01 0.01 × 3.20% × (1 – 21.00%) = 0.02%
Total: 65,741,247  1.00 12.68%

Based on: 10-K (filing date: 2020-02-06).

1 US$ in thousands

2 Equity. See details »

3 Notes payable and other financing arrangements, including current portion. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 65,551,235  65,551,235  ÷ 72,097,173  = 0.91 0.91 × 13.82% = 12.57%
Notes payable and other financing arrangements, including current portion3 6,037,600  6,037,600  ÷ 72,097,173  = 0.08 0.08 × 4.03% × (1 – 21.00%) = 0.27%
Operating lease liability4 508,338  508,338  ÷ 72,097,173  = 0.01 0.01 × 4.03% × (1 – 21.00%) = 0.02%
Total: 72,097,173  1.00 12.86%

Based on: 10-K (filing date: 2019-02-06).

1 US$ in thousands

2 Equity. See details »

3 Notes payable and other financing arrangements, including current portion. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 73,200,689  73,200,689  ÷ 80,193,569  = 0.91 0.91 × 13.82% = 12.62%
Notes payable and other financing arrangements, including current portion3 6,483,300  6,483,300  ÷ 80,193,569  = 0.08 0.08 × 4.03% × (1 – 35.00%) = 0.21%
Operating lease liability4 509,579  509,579  ÷ 80,193,569  = 0.01 0.01 × 4.03% × (1 – 35.00%) = 0.02%
Total: 80,193,569  1.00 12.84%

Based on: 10-K (filing date: 2018-02-01).

1 US$ in thousands

2 Equity. See details »

3 Notes payable and other financing arrangements, including current portion. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 57,060,982  57,060,982  ÷ 64,429,508  = 0.89 0.89 × 13.82% = 12.24%
Notes payable and other financing arrangements, including current portion3 6,826,500  6,826,500  ÷ 64,429,508  = 0.11 0.11 × 4.29% × (1 – 35.00%) = 0.30%
Operating lease liability4 542,026  542,026  ÷ 64,429,508  = 0.01 0.01 × 4.29% × (1 – 35.00%) = 0.02%
Total: 64,429,508  1.00 12.56%

Based on: 10-K (filing date: 2017-02-02).

1 US$ in thousands

2 Equity. See details »

3 Notes payable and other financing arrangements, including current portion. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 59,135,663  59,135,663  ÷ 66,379,352  = 0.89 0.89 × 13.82% = 12.31%
Notes payable and other financing arrangements, including current portion3 6,665,700  6,665,700  ÷ 66,379,352  = 0.10 0.10 × 4.29% × (1 – 35.00%) = 0.28%
Operating lease liability4 577,990  577,990  ÷ 66,379,352  = 0.01 0.01 × 4.29% × (1 – 35.00%) = 0.02%
Total: 66,379,352  1.00 12.62%

Based on: 10-K (filing date: 2016-02-03).

1 US$ in thousands

2 Equity. See details »

3 Notes payable and other financing arrangements, including current portion. See details »

4 Operating lease liability. See details »

Economic Spread Ratio

Biogen Inc., economic spread ratio calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data (US$ in thousands)
Economic profit1 4,230,592  2,969,824  1,287,285  2,005,023  2,157,034 
Invested capital2 14,142,400  13,170,638  12,477,279  12,901,026  11,109,890 
Performance Ratio
Economic spread ratio3 29.91% 22.55% 10.32% 15.54% 19.42%
Benchmarks
Economic Spread Ratio, Competitors4
Abbott Laboratories -5.66% -5.90% -11.02% -7.44% -2.61%
AbbVie Inc. 6.13% 5.94% -6.01% 2.97% 4.25%
Amgen Inc. 11.54% 26.49% -4.14% 16.45% 10.17%
Bristol-Myers Squibb Co. -5.32% 19.33% 3.72% 15.82% 0.31%
Eli Lilly & Co. 18.86% 10.35% -8.48% 10.17% 3.03%
Gilead Sciences Inc. 1.54% 7.42% 8.95% 56.81% 56.23%
Illumina Inc. 6.56% 7.04% 8.16% 3.48% 4.26%
Johnson & Johnson 4.44% 5.91% -4.76% 10.82% 12.72%
Merck & Co. Inc. 11.83% 5.08% -6.05% -1.84% -1.19%
Pfizer Inc. 6.95% 4.12% -12.21% -1.26% -0.03%
Regeneron Pharmaceuticals Inc. 19.92% 22.74% 15.05% 8.05% 23.11%
Vertex Pharmaceuticals Inc. 10.81% -0.33% -15.77% -15.53% -35.11%
Zoetis Inc. 6.49% 6.47% 4.78% 1.96% -0.81%

Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-06), 10-K (filing date: 2018-02-01), 10-K (filing date: 2017-02-02), 10-K (filing date: 2016-02-03).

1 Economic profit. See details »

2 Invested capital. See details »

3 2019 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × 4,230,592 ÷ 14,142,400 = 29.91%

4 Click competitor name to see calculations.

Performance ratio Description The company
Economic spread ratio The ratio of economic profit to invested capital, also equal to the difference between return on invested capital (ROIC) and cost of capital. Biogen Inc.’s economic spread ratio improved from 2017 to 2018 and from 2018 to 2019.

Economic Profit Margin

Biogen Inc., economic profit margin calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data (US$ in thousands)
Economic profit1 4,230,592  2,969,824  1,287,285  2,005,023  2,157,034 
Revenues 14,377,900  13,452,900  12,273,900  11,448,800  10,763,800 
Performance Ratio
Economic profit margin2 29.42% 22.08% 10.49% 17.51% 20.04%
Benchmarks
Economic Profit Margin, Competitors3
Abbott Laboratories -10.24% -11.27% -26.30% -16.17% -3.88%
AbbVie Inc. 11.57% 6.07% -9.64% 5.58% 8.15%
Amgen Inc. 19.43% 29.65% -4.58% 24.28% 16.94%
Bristol-Myers Squibb Co. -20.41% 16.26% 2.96% 14.44% 0.27%
Eli Lilly & Co. 18.16% 10.83% -8.28% 10.92% 3.38%
Gilead Sciences Inc. 2.24% 12.18% 8.57% 38.01% 48.04%
Illumina Inc. 9.26% 8.42% 10.67% 4.17% 5.26%
Johnson & Johnson 5.25% 7.33% -6.64% 12.68% 13.54%
Merck & Co. Inc. 13.55% 5.89% -7.50% -2.45% -1.89%
Pfizer Inc. 16.26% 7.81% -23.89% -2.92% -0.07%
Regeneron Pharmaceuticals Inc. 16.42% 21.04% 12.59% 5.56% 14.74%
Vertex Pharmaceuticals Inc. 12.63% -0.42% -19.91% -27.09% -88.96%
Zoetis Inc. 10.19% 10.38% 6.75% 2.71% -1.19%

Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-06), 10-K (filing date: 2018-02-01), 10-K (filing date: 2017-02-02), 10-K (filing date: 2016-02-03).

1 Economic profit. See details »

2 2019 Calculation
Economic profit margin = 100 × Economic profit ÷ Revenues
= 100 × 4,230,592 ÷ 14,377,900 = 29.42%

3 Click competitor name to see calculations.

Performance ratio Description The company
Economic profit margin The ratio of economic profit to sales. It is the company’s profit margin covering income efficiency and asset management. Economic profit margin is not biased in favor of capital-intensive business models, because any added capital is a cost to the economic profit margin. Biogen Inc.’s economic profit margin improved from 2017 to 2018 and from 2018 to 2019.