Price to FCFE (P/FCFE)
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Biogen Inc. pages available for free this week:
- Balance Sheet: Assets
- Common-Size Income Statement
- Common-Size Balance Sheet: Assets
- Analysis of Liquidity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Common Stock Valuation Ratios
- Enterprise Value to FCFF (EV/FCFF)
- Present Value of Free Cash Flow to Equity (FCFE)
- Operating Profit Margin since 2005
- Debt to Equity since 2005
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Free Cash Flow to Equity (FCFE)
Biogen Inc., FCFE calculation
US$ in thousands
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
The analysis of the annual financial data reveals distinct trends concerning the company's cash flow metrics over the five-year period from 2017 to 2021.
- Net Cash Flow Provided by Operating Activities
- The net cash flow from operating activities shows an overall increasing trend from 2017 to 2019, rising from approximately 4.55 billion USD to about 7.08 billion USD. This indicates a strengthening operational cash generation capacity in those years. However, there is a noticeable decline in 2020, with cash inflow dropping to around 4.23 billion USD, followed by a further decrease to approximately 3.64 billion USD in 2021. This downward trend over the last two years may signal operational challenges or increased cash outflows, warranting further investigation into underlying causes.
- Free Cash Flow to Equity (FCFE)
- Free cash flow to equity exhibits a significant growth between 2017 and 2019, increasing from roughly 2.15 billion USD to nearly 6.41 billion USD. This positive trajectory reflects enhanced cash availability for equity holders during this period. Similarly to the operating cash flow pattern, 2020 and 2021 see a reduction in FCFE to about 5.22 billion USD and 3.19 billion USD respectively. The decline in these years could be related to increased capital expenditures, debt repayments, or changes in working capital dynamics affecting the free cash available to shareholders.
In summary, both primary cash flow indicators initially exhibit strong growth, highlighting improved financial health and operational efficiency up to 2019. Yet, the subsequent decline in 2020 and 2021 suggests emerging pressures or economic factors impacting liquidity and cash distribution capacity. These shifts underscore the importance of examining external market conditions and internal strategic decisions during the later years to fully comprehend the cash flow reductions.
Price to FCFE Ratio, Current
Biogen Inc., current P/FCFE calculation, comparison to benchmarks
| No. shares of common stock outstanding | |
| Selected Financial Data (US$) | |
| Free cash flow to equity (FCFE) (in thousands) | |
| FCFE per share | |
| Current share price (P) | |
| Valuation Ratio | |
| P/FCFE | |
| Benchmarks | |
| P/FCFE, Competitors1 | |
| AbbVie Inc. | |
| Amgen Inc. | |
| Bristol-Myers Squibb Co. | |
| Danaher Corp. | |
| Eli Lilly & Co. | |
| Gilead Sciences Inc. | |
| Johnson & Johnson | |
| Merck & Co. Inc. | |
| Pfizer Inc. | |
| Regeneron Pharmaceuticals Inc. | |
| Thermo Fisher Scientific Inc. | |
| Vertex Pharmaceuticals Inc. | |
| P/FCFE, Sector | |
| Pharmaceuticals, Biotechnology & Life Sciences | |
| P/FCFE, Industry | |
| Health Care | |
Based on: 10-K (reporting date: 2021-12-31).
1 Click competitor name to see calculations.
If the company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.
Otherwise, if the company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.
Price to FCFE Ratio, Historical
Biogen Inc., historical P/FCFE calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||||
| Selected Financial Data (US$) | ||||||
| Free cash flow to equity (FCFE) (in thousands)2 | ||||||
| FCFE per share3 | ||||||
| Share price1, 4 | ||||||
| Valuation Ratio | ||||||
| P/FCFE5 | ||||||
| Benchmarks | ||||||
| P/FCFE, Competitors6 | ||||||
| AbbVie Inc. | ||||||
| Amgen Inc. | ||||||
| Bristol-Myers Squibb Co. | ||||||
| Danaher Corp. | ||||||
| Eli Lilly & Co. | ||||||
| Gilead Sciences Inc. | ||||||
| Johnson & Johnson | ||||||
| Merck & Co. Inc. | ||||||
| Pfizer Inc. | ||||||
| Regeneron Pharmaceuticals Inc. | ||||||
| Thermo Fisher Scientific Inc. | ||||||
| Vertex Pharmaceuticals Inc. | ||||||
| P/FCFE, Sector | ||||||
| Pharmaceuticals, Biotechnology & Life Sciences | ||||||
| P/FCFE, Industry | ||||||
| Health Care | ||||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 Data adjusted for splits and stock dividends.
3 2021 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= ÷ =
4 Closing price as at the filing date of Biogen Inc. Annual Report.
5 2021 Calculation
P/FCFE = Share price ÷ FCFE per share
= ÷ =
6 Click competitor name to see calculations.
- Share Price
- The share price exhibited a declining trend over the five-year period. It started at $346 in 2017 and decreased slightly to $333.24 in 2018, then remained relatively flat in 2019 at $337.24. From 2019 onward, the share price experienced a more notable decline, dropping to $263.25 in 2020 and further to $220.17 in 2021. This downward movement suggests a reduction in market valuation or investor confidence during the latter part of the period.
- Free Cash Flow to Equity (FCFE) per Share
- FCFE per share showed an overall positive growth trend ascending from $10.15 in 2017 to a peak of $36.82 in 2019. Although there was a slight decrease to $34.27 in 2020, the FCFE per share remained significantly higher than at the start of the period. However, a more pronounced decline to $21.73 occurred in 2021, indicating potential variations in cash flows available to equity shareholders in the recent year.
- Price-to-FCFE (P/FCFE) Ratio
- The P/FCFE ratio declined markedly from 34.09 in 2017 to 7.68 in 2020, indicating that the market price per share decreased relative to the FCFE per share, potentially suggesting undervaluation or re-rating by investors. In 2021, the ratio increased to 10.13, reflecting a slight recovery in valuation relative to FCFE despite the earlier price decline. This pattern points to fluctuating market perceptions of the company's free cash flow generation capability over time.
- Overall Insights
- While free cash flow per share improved substantially early in the period, it experienced a setback in the final reported year. The share price displayed a downward trend throughout, which when contrasted with rising FCFE per share initially, resulted in compressing valuation multiples as seen in the P/FCFE ratio. The modest rebound in P/FCFE in 2021 alongside the drop in FCFE per share suggests that market valuation may have partially adjusted after prior adjustments, possibly responding to less favorable cash flow performance. These trends may highlight periods of changing investor sentiment and operational shifts affecting financial performance.