Price to FCFE (P/FCFE)
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Broadcom Inc. pages available for free this week:
- Balance Sheet: Liabilities and Stockholders’ Equity
- Cash Flow Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Long-term (Investment) Activity Ratios
- Enterprise Value to EBITDA (EV/EBITDA)
- Enterprise Value to FCFF (EV/FCFF)
- Capital Asset Pricing Model (CAPM)
- Selected Financial Data since 2009
- Total Asset Turnover since 2009
- Price to Sales (P/S) since 2009
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Free Cash Flow to Equity (FCFE)
Broadcom Inc., FCFE calculation
US$ in millions
Based on: 10-K (reporting date: 2024-11-03), 10-K (reporting date: 2023-10-29), 10-K (reporting date: 2022-10-30), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-11-01), 10-K (reporting date: 2019-11-03).
- Net Cash Provided by Operating Activities
- The net cash provided by operating activities shows a consistent upward trend over the six-year period. Starting from $9,697 million in 2019, the figure increased steadily each year, reaching $19,962 million by 2024. This steady growth indicates an improving cash generation capability from the company's core operations over time.
- Free Cash Flow to Equity (FCFE)
- The free cash flow to equity exhibits a more variable pattern compared to operating cash flow. It started at a high level of $22,499 million in 2019, then declined to $19,301 million in 2020, followed by a more pronounced decrease to $11,730 million in 2021. After this decline, FCFE recovered to $15,886 million in 2022 and $17,230 million in 2023. Notably, there is a substantial increase to $39,760 million in 2024, more than doubling the previous year's figure. This significant jump in 2024 suggests a major positive shift in the company's cash available to equity holders, which may be due to improved operational cash flow, reduced capital expenditures, changes in financing activities, or other strategic financial decisions.
- Overall Insights
- The consistent increase in operating cash flow coupled with the fluctuating but ultimately substantially increasing FCFE toward the end of the period suggests stronger cash generation and improved financial flexibility. The marked increase in FCFE for 2024 could imply enhanced efficiency in capital management or a one-time event positively affecting cash flows. Overall, the data reflects improving liquidity and potential for increased shareholder value distribution in the most recent year.
Price to FCFE Ratio, Current
Broadcom Inc., current P/FCFE calculation, comparison to benchmarks
| No. shares of common stock outstanding | |
| Selected Financial Data (US$) | |
| Free cash flow to equity (FCFE) (in millions) | |
| FCFE per share | |
| Current share price (P) | |
| Valuation Ratio | |
| P/FCFE | |
| Benchmarks | |
| P/FCFE, Competitors1 | |
| Advanced Micro Devices Inc. | |
| Analog Devices Inc. | |
| Applied Materials Inc. | |
| Intel Corp. | |
| KLA Corp. | |
| Lam Research Corp. | |
| Micron Technology Inc. | |
| NVIDIA Corp. | |
| Qualcomm Inc. | |
| Texas Instruments Inc. | |
| P/FCFE, Sector | |
| Semiconductors & Semiconductor Equipment | |
| P/FCFE, Industry | |
| Information Technology | |
Based on: 10-K (reporting date: 2024-11-03).
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
Broadcom Inc., historical P/FCFE calculation, comparison to benchmarks
| Nov 3, 2024 | Oct 29, 2023 | Oct 30, 2022 | Oct 31, 2021 | Nov 1, 2020 | Nov 3, 2019 | ||
|---|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | |||||||
| Selected Financial Data (US$) | |||||||
| Free cash flow to equity (FCFE) (in millions)2 | |||||||
| FCFE per share3 | |||||||
| Share price1, 4 | |||||||
| Valuation Ratio | |||||||
| P/FCFE5 | |||||||
| Benchmarks | |||||||
| P/FCFE, Competitors6 | |||||||
| Advanced Micro Devices Inc. | |||||||
| Analog Devices Inc. | |||||||
| Applied Materials Inc. | |||||||
| Intel Corp. | |||||||
| KLA Corp. | |||||||
| Lam Research Corp. | |||||||
| Micron Technology Inc. | |||||||
| NVIDIA Corp. | |||||||
| Qualcomm Inc. | |||||||
| Texas Instruments Inc. | |||||||
| P/FCFE, Sector | |||||||
| Semiconductors & Semiconductor Equipment | |||||||
| P/FCFE, Industry | |||||||
| Information Technology | |||||||
Based on: 10-K (reporting date: 2024-11-03), 10-K (reporting date: 2023-10-29), 10-K (reporting date: 2022-10-30), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-11-01), 10-K (reporting date: 2019-11-03).
1 Data adjusted for splits and stock dividends.
3 2024 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= ÷ =
4 Closing price as at the filing date of Broadcom Inc. Annual Report.
5 2024 Calculation
P/FCFE = Share price ÷ FCFE per share
= ÷ =
6 Click competitor name to see calculations.
- Share Price Trends
- The share price demonstrated a consistent upward trend over the analyzed periods. Starting at $31.9 in 2019, it increased steadily to $43.46 in 2020 and further to $63.5 in 2021. A slight decline occurred in 2022 with the price dropping to $55.59, which was followed by a significant increase in 2023 to $110.65, and then doubling again in 2024 to reach $220.79. This pattern indicates a strong overall market appreciation and investor confidence in the asset over the six-year span.
- Free Cash Flow to Equity (FCFE) per Share
- FCFE per share exhibited fluctuating behavior throughout the periods under review. The value started at $5.66 in 2019 and then declined to $4.75 in 2020, continuing a downward trend to $2.84 in 2021. A recovery phase occurred in 2022 with an increase to $3.8, followed by a slight dip to $3.68 in 2023. Notably, there was a substantial rise in 2024, where FCFE per share climbed to $8.48, representing the highest level in the period analyzed, suggesting improved cash-generating efficiency or profitability at the equity level in the latest year.
- Price to FCFE Ratio (P/FCFE)
- The P/FCFE ratio experienced considerable volatility. Initially, it was relatively low at 5.64 in 2019, implying a modest price relative to free cash flow. However, the ratio escalated sharply to 9.16 in 2020 and then more than doubled to 22.35 in 2021. It decreased somewhat to 14.62 in 2022 before surging again to 30.06 in 2023. A slight decline to 26.03 occurred in 2024 but still remained at an elevated level compared to earlier years. This fluctuation suggests changing investor sentiment and valuation multiples, likely influenced by the interplay between share price increases and FCFE per share performance. The high ratios in later years reflect strong market valuation possibly detached from cash flow growth trends in some years, indicating potentially elevated market expectations or reduced FCFE growth in those periods.
- Overall Insights
- The data reveals a strong increase in market valuation as represented by the share price and P/FCFE ratio, especially notable from 2022 onward. While FCFE per share showed some volatility and decline in the early years, it recovered significantly in the most recent year, which may partly justify the high valuation. However, the sustained high P/FCFE ratios suggest that investors have placed a premium on the stock, potentially anticipating future growth or improved performance beyond the reported FCFE figures. The divergence between equity cash flows and market valuation may warrant further investigation into underlying business performance drivers and market conditions affecting investor expectations.