.Enterprise Value to FCFF (EV/FCFF)
Difficulty: Intermediate
Free Cash Flow to The Firm (FCFF)
Broadcom Inc., FCFF calculation
USD $ in millions
| 12 months ended | Oct 29, 2017 | Oct 30, 2016 | Nov 1, 2015 | Nov 2, 2014 | Nov 3, 2013 | Oct 28, 2012 | |
|---|---|---|---|---|---|---|---|
| | Net income (loss) attributable to ordinary shares | ||||||
| | Net (income) loss attributable to noncontrolling interest | ||||||
| | Net noncash charges | ||||||
| | Changes in assets and liabilities, net of acquisitions and disposals | ||||||
| | Net cash provided by operating activities | ||||||
| | Cash paid for interest, net of tax1 | ||||||
| | Purchases of property, plant and equipment | ||||||
| | Proceeds from disposals of property, plant and equipment | ||||||
| | 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 Broadcom Inc.'s suppliers of capital after all operating expenses have been paid and necessary investments in working and fixed capital have been made. | Broadcom Inc.'s FCFF increased from 2015 to 2016 and from 2016 to 2017. |
Interest Paid, Net of Tax
Broadcom Inc., interest paid, net of tax calculation
USD $ in millions
| 12 months ended | Oct 29, 2017 | Oct 30, 2016 | Nov 1, 2015 | Nov 2, 2014 | Nov 3, 2013 | Oct 28, 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
Broadcom 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 | |
| Apple Inc. | |
| Applied Materials Inc. | |
| 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
Broadcom Inc., historical EV/FCFF calculation, comparison to benchmarks
| Oct 29, 2017 | Oct 30, 2016 | Nov 1, 2015 | Nov 2, 2014 | Nov 3, 2013 | Oct 28, 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 | |||||||
| Apple Inc. | |||||||
| Applied Materials Inc. | |||||||
| 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. | Broadcom Inc.'s EV/FCFF ratio increased from 2015 to 2016 but then declined significantly from 2016 to 2017. |
