Market Value Added (MVA)
Market value added (MVA) is the difference between a firm 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
First Solar Inc., MVA calculation
US$ in thousands
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 Fair value of debt. See details »
2 Invested capital. See details »
- Market (fair) value of First Solar
- The market value exhibited a notable upward trend from 2019 through 2020, increasing significantly from approximately 4.93 billion to 8.30 billion US dollars. In 2021, there was a slight decline to about 7.82 billion, followed by a substantial surge in 2022 reaching approximately 16.96 billion. However, in 2023, the market value experienced a decrease, settling at roughly 15.72 billion. Overall, the market value more than tripled over the five-year period despite fluctuations in the latter years.
- Invested capital
- Invested capital demonstrated a generally increasing trend from 2019 to 2023, rising from about 4.89 billion to 7.84 billion US dollars. A moderate increase was observed between 2019 and 2021, peaking at around 5.69 billion in 2021. This was followed by a decline to approximately 5.05 billion in 2022, after which the figure rose sharply to 7.84 billion in 2023. The fluctuation seen in 2022 appears to be an anomaly within the otherwise upward movement of invested capital.
- Market value added (MVA)
- MVA, indicating the difference between the market value and invested capital, showed considerable volatility over the period. Starting at 33 million US dollars in 2019, it surged dramatically to over 3.19 billion in 2020, reflecting strong market appreciation relative to invested capital. In 2021, MVA decreased to around 2.13 billion, and despite the market value peak in 2022, MVA increased further to approximately 11.91 billion. By 2023, MVA declined significantly to about 7.88 billion. These fluctuations suggest varying investor perceptions of value creation relative to capital investment over time.
MVA Spread Ratio
First Solar Inc., MVA spread ratio calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Market value added (MVA)1 | 7,875,720) | 11,909,547) | 2,131,153) | 3,190,566) | 33,065) | |
| Invested capital2 | 7,840,426) | 5,054,301) | 5,692,249) | 5,111,222) | 4,894,577) | |
| Performance Ratio | ||||||
| MVA spread ratio3 | 100.45% | 235.63% | 37.44% | 62.42% | 0.68% | |
| Benchmarks | ||||||
| MVA Spread Ratio, Competitors4 | ||||||
| Advanced Micro Devices Inc. | 370.13% | 119.87% | 2,219.60% | 2,281.37% | — | |
| Analog Devices Inc. | 117.77% | 103.56% | 117.94% | 210.89% | 164.19% | |
| Applied Materials Inc. | 671.06% | 515.59% | 815.05% | 555.54% | 482.20% | |
| Broadcom Inc. | 780.16% | 327.91% | 373.50% | 237.77% | 168.52% | |
| Intel Corp. | 136.50% | 56.17% | 138.47% | 204.49% | — | |
| KLA Corp. | 749.44% | 664.92% | 735.85% | 430.36% | 274.54% | |
| Lam Research Corp. | 511.21% | 404.85% | 617.13% | 423.68% | 264.92% | |
| Micron Technology Inc. | 65.44% | 17.24% | 80.72% | 54.74% | 45.95% | |
| NVIDIA Corp. | 2,593.21% | 3,533.65% | 2,455.53% | 1,247.78% | — | |
| Qualcomm Inc. | 331.81% | 372.61% | 739.14% | 815.45% | 438.33% | |
| Texas Instruments Inc. | 565.70% | 853.39% | 887.48% | 1,141.98% | — | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 MVA. See details »
2 Invested capital. See details »
3 2023 Calculation
MVA spread ratio = 100 × MVA ÷ Invested capital
= 100 × 7,875,720 ÷ 7,840,426 = 100.45%
4 Click competitor name to see calculations.
- Market Value Added (MVA)
- The MVA exhibited a significant upward trend from 2019 to 2022, increasing from approximately 33 million USD to over 11.9 billion USD. However, in 2023, there was a notable decline to around 7.9 billion USD. Despite this decrease, the MVA level in 2023 remained substantially higher compared to the initial years.
- Invested Capital
- The invested capital showed a generally increasing pattern over the five-year period, rising from approximately 4.9 billion USD in 2019 to 7.8 billion USD in 2023. The amount fluctuated slightly in 2022, where there was a decrease compared to 2021, before increasing again in 2023 to its highest level in the dataset.
- MVA Spread Ratio
- The MVA spread ratio exhibited volatility throughout the years. It started very low at 0.68% in 2019 and then surged dramatically to 62.42% in 2020. After a slight decrease to 37.44% in 2021, the ratio peaked sharply at 235.63% in 2022, indicating a very high market value added relative to invested capital. In 2023, the ratio decreased to 100.45%, which while lower than the previous year's peak, still signals a strong value creation over invested capital compared to the earlier years.
- Overall Insights
- Over the analyzed period, there is clear evidence of substantial value creation as reflected by the growth in MVA and elevated MVA spread ratios, particularly from 2020 through 2022. The dip in MVA and the MVA spread ratio in 2023 suggests some erosion in market value added, though the levels remain robust compared to the beginning of the period. Invested capital maintained an upward trajectory with minor fluctuations, indicating ongoing investment activity and capital commitment by the company. The trends suggest a cycle of rapid value creation followed by a consolidation or revaluation phase in the most recent year.
MVA Margin
First Solar Inc., MVA margin calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Market value added (MVA)1 | 7,875,720) | 11,909,547) | 2,131,153) | 3,190,566) | 33,065) | |
| Net sales | 3,318,602) | 2,619,319) | 2,923,377) | 2,711,332) | 3,063,117) | |
| Add: Increase (decrease) in deferred revenue | 797,243) | 910,129) | 64,079) | (160,923) | 216,886) | |
| Adjusted net sales | 4,115,845) | 3,529,448) | 2,987,456) | 2,550,409) | 3,280,003) | |
| Performance Ratio | ||||||
| MVA margin2 | 191.35% | 337.43% | 71.34% | 125.10% | 1.01% | |
| Benchmarks | ||||||
| MVA Margin, Competitors3 | ||||||
| Advanced Micro Devices Inc. | 944.62% | 297.25% | 836.71% | 1,019.76% | — | |
| Analog Devices Inc. | 422.86% | 388.08% | 757.72% | 685.43% | 502.84% | |
| Applied Materials Inc. | 449.88% | 297.74% | 520.10% | 422.74% | 334.35% | |
| Broadcom Inc. | 1,364.99% | 613.41% | 879.64% | 656.13% | 447.69% | |
| Intel Corp. | 231.83% | 78.99% | 155.07% | 215.26% | — | |
| KLA Corp. | 595.30% | 562.17% | 725.25% | 482.13% | 383.29% | |
| Lam Research Corp. | 448.84% | 298.83% | 497.72% | 492.95% | 285.07% | |
| Micron Technology Inc. | 225.16% | 29.56% | 135.02% | 108.00% | 76.12% | |
| NVIDIA Corp. | 2,051.63% | 2,368.66% | 1,919.74% | 1,616.28% | — | |
| Qualcomm Inc. | 291.70% | 248.18% | 445.16% | 615.38% | 387.14% | |
| Texas Instruments Inc. | 729.45% | 748.35% | 793.86% | 1,023.69% | — | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 MVA. See details »
2 2023 Calculation
MVA margin = 100 × MVA ÷ Adjusted net sales
= 100 × 7,875,720 ÷ 4,115,845 = 191.35%
3 Click competitor name to see calculations.
- Market Value Added (MVA)
- The MVA demonstrates significant fluctuations over the observed five-year period. Beginning at a low point of 33,065 thousand US dollars in 2019, it surged dramatically to 3,190,566 thousand US dollars in 2020. Subsequently, it declined to 2,131,153 thousand US dollars in 2021, before experiencing a robust increase to 11,909,547 thousand US dollars in 2022. In 2023, the MVA decreased again to 7,875,720 thousand US dollars. The trend indicates considerable volatility, with notable peaks in 2020 and 2022.
- Adjusted Net Sales
- Adjusted net sales show a generally upward trajectory across the five years. From 3,280,003 thousand US dollars in 2019, there was a decrease to 2,550,409 thousand US dollars in 2020. However, sales recovered in 2021 to 2,987,456 thousand US dollars, followed by continuous growth in 2022 and 2023, reaching 3,529,448 and 4,115,845 thousand US dollars respectively. This pattern reveals an initial disruption or decline in sales in 2020, which was subsequently overcome.
- MVA Margin
- The MVA margin, expressed as a percentage, exhibits substantial volatility with steep increases and decreases. Starting from a modest 1.01% in 2019, it shot up to 125.1% in 2020, then dropped to 71.34% in 2021. In 2022, there was a sharp rise to 337.43%, followed by a decrease to 191.35% in 2023. The large swings in this margin suggest variable efficiency or profitability relative to market value added, with pronounced gains particularly in 2020 and 2022.
- Overall Insights
- The data reflect a period marked by significant variability in market value added and corresponding margins, contrasted with a gradually improving sales performance after an initial downturn. The spikes in MVA and MVA margin in certain years may indicate episodic value creation, possibly linked to market or operational factors. Meanwhile, adjusted net sales portray a recovery and growth trend, indicating strengthening revenue generation despite fluctuations in market value metrics.