Microsoft Excel LibreOffice Calc

Broadcom Inc. (NASDAQ:AVGO)


Market Value Added (MVA)

Advanced level

Market value added (MVA) is the difference between a firms’s fair value and its invested capital. MVA is a measure of the value a company has created in excess of the resources already committed to the enterprise.


MVA

Broadcom Inc., MVA calculation

US$ in millions

Microsoft Excel LibreOffice Calc
Nov 3, 2019 Nov 4, 2018 Oct 29, 2017 Oct 30, 2016 Nov 1, 2015 Nov 2, 2014
Fair value of debt1 33,652  16,627  17,953  13,642  3,949  5,460 
Operating lease liability 649  512  591  410  140  112 
Market value of common equity 126,896  99,745  107,061  72,590  38,841  25,863 
Preferred stock, $0.001 par value; 8.00% Mandatory Convertible Preferred Stock, Series A —  —  —  —  —  — 
Noncontrolling interest —  —  2,901  2,984  —  — 
Market (fair) value of Broadcom 161,197  116,884  128,506  89,626  42,930  31,435 
Less: Invested capital2 60,032  44,617  51,048  45,840  8,437  8,755 
MVA 101,165  72,267  77,458  43,786  34,493  22,680 

Based on: 10-K (filing date: 2019-12-20), 10-K (filing date: 2018-12-21), 10-K (filing date: 2017-12-21), 10-K (filing date: 2016-12-23), 10-K (filing date: 2015-12-17), 10-K (filing date: 2014-12-29).

1 Fair value of debt. See details »

2 Invested capital. See details »

Item Description The company
MVA Broadcom Inc.’s market (fair) value less invested capital. Broadcom Inc.’s MVA decreased from 2017 to 2018 but then increased from 2018 to 2019 exceeding 2017 level.

MVA Spread Ratio

Broadcom Inc., MVA spread ratio calculation

Microsoft Excel LibreOffice Calc
Nov 3, 2019 Nov 4, 2018 Oct 29, 2017 Oct 30, 2016 Nov 1, 2015 Nov 2, 2014
Selected Financial Data (US$ in millions)
Market value added (MVA)1 101,165  72,267  77,458  43,786  34,493  22,680 
Invested capital2 60,032  44,617  51,048  45,840  8,437  8,755 
Performance Ratio
MVA spread ratio3 168.52% 161.97% 151.73% 95.52% 408.84% 259.04%

Based on: 10-K (filing date: 2019-12-20), 10-K (filing date: 2018-12-21), 10-K (filing date: 2017-12-21), 10-K (filing date: 2016-12-23), 10-K (filing date: 2015-12-17), 10-K (filing date: 2014-12-29).

1 MVA. See details »

2 Invested capital. See details »

3 2019 Calculation
MVA spread ratio = 100 × MVA ÷ Invested capital
= 100 × 101,165 ÷ 60,032 = 168.52%

Performance ratio Description The company
MVA spread ratio The ratio of MVA to invested capital. It measures the efficiency with which investors’ capital investment has translated into a franchise value and into an aggregate net present value premium. Broadcom Inc.’s MVA spread ratio improved from 2017 to 2018 and from 2018 to 2019.

MVA Margin

Broadcom Inc., MVA margin calculation

Microsoft Excel LibreOffice Calc
Nov 3, 2019 Nov 4, 2018 Oct 29, 2017 Oct 30, 2016 Nov 1, 2015 Nov 2, 2014
Selected Financial Data (US$ in millions)
Market value added (MVA)1 101,165  72,267  77,458  43,786  34,493  22,680 
Net revenue 22,597  20,848  17,636  13,240  6,824  4,269 
Performance Ratio
MVA margin2 447.69% 346.64% 439.20% 330.71% 505.47% 531.26%

Based on: 10-K (filing date: 2019-12-20), 10-K (filing date: 2018-12-21), 10-K (filing date: 2017-12-21), 10-K (filing date: 2016-12-23), 10-K (filing date: 2015-12-17), 10-K (filing date: 2014-12-29).

1 MVA. See details »

2 2019 Calculation
MVA margin = 100 × MVA ÷ Net revenue
= 100 × 101,165 ÷ 22,597 = 447.69%

Performance ratio Description The company
MVA margin The ratio of MVA to sales. It measures how efficiently and prodigiously sales translate into franchise value. Broadcom Inc.’s MVA margin ratio deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level.