Enterprise Value to FCFF (EV/FCFF)
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- Common-Size Balance Sheet: Assets
- Analysis of Short-term (Operating) Activity Ratios
- Enterprise Value to EBITDA (EV/EBITDA)
- Capital Asset Pricing Model (CAPM)
- Selected Financial Data since 2005
- Net Profit Margin since 2005
- Return on Equity (ROE) since 2005
- Price to Earnings (P/E) since 2005
- Analysis of Revenues
- Analysis of Debt
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Free Cash Flow to The Firm (FCFF)
Gilead Sciences Inc., FCFF calculation
US$ in millions
Based on: 10-K (reporting date: 2024-12-31), 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).
- Net cash provided by operating activities
- The net cash provided by operating activities exhibited notable fluctuations over the five-year period. Starting at 8,168 million US dollars in 2020, it increased significantly to a peak of 11,384 million US dollars in 2021. Subsequently, there was a decline to 9,072 million US dollars in 2022, followed by a further decrease to 8,006 million US dollars in 2023. However, this downward trend reversed in 2024, with the figure rising again to 10,828 million US dollars. Overall, this suggests a degree of variability in operating cash flows with a pronounced peak in 2021 and a recovery towards the end of the period.
- Free cash flow to the firm (FCFF)
- The free cash flow to the firm showed a pattern closely mirroring the operating cash flow behavior. An initial increase from 7,568 million US dollars in 2020 to a high of 11,538 million US dollars in 2021 was observed, followed by a drop to 9,056 million US dollars in 2022 and a slight rebound to 8,150 million US dollars in 2023. The FCFF then increased notably to 10,966 million US dollars in 2024. This parallel movement indicates that after initial growth, there were pressures reducing free cash flow in the middle years before a recovery took place, reflecting potentially shifting operational efficiencies or investment activities impacting cash generation.
Interest Paid, Net of Tax
Gilead Sciences Inc., interest paid, net of tax calculation
US$ in millions
Based on: 10-K (reporting date: 2024-12-31), 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).
2 2024 Calculation
Interest paid, net of amounts capitalized, tax = Interest paid, net of amounts capitalized × EITR
= × =
- Effective Income Tax Rate (EITR)
- The effective income tax rate exhibited significant variability over the observed period. Starting at a notably high level of 94.7% in 2020, it underwent a substantial decline in subsequent years, dropping to 25.1% in 2021 and continuing a gradual decrease to 18.2% in 2023. However, in 2024, the rate increased again to 30.5%. This pattern suggests considerable fluctuations in the company's tax environment or tax-related events impacting reported earnings during this timeframe.
- Interest Paid, Net of Amounts Capitalized, Net of Tax
- The interest paid, net of capitalized amounts and tax, demonstrated an overall increasing trend from 2020 through 2023. The amount rose sharply from US$50 million in 2020 to a peak of US$733 million in 2021, followed by a slight decline but remaining elevated at US$712 million in 2022 and US$729 million in 2023. In 2024, a moderate reduction was observed, with interest paid decreasing to US$661 million. This pattern indicates a significant increase in interest expenses starting in 2021, which then stabilized at a higher level compared to 2020 but showed signs of a mild downward adjustment in the most recent year.
Enterprise Value to FCFF Ratio, Current
Gilead Sciences Inc., current EV/FCFF calculation, comparison to benchmarks
| Selected Financial Data (US$ in millions) | |
| Enterprise value (EV) | |
| Free cash flow to the firm (FCFF) | |
| Valuation Ratio | |
| EV/FCFF | |
| Benchmarks | |
| EV/FCFF, Competitors1 | |
| AbbVie Inc. | |
| Amgen Inc. | |
| Bristol-Myers Squibb Co. | |
| Danaher Corp. | |
| Eli Lilly & Co. | |
| Johnson & Johnson | |
| Merck & Co. Inc. | |
| Pfizer Inc. | |
| Regeneron Pharmaceuticals Inc. | |
| Thermo Fisher Scientific Inc. | |
| Vertex Pharmaceuticals Inc. | |
| EV/FCFF, Sector | |
| Pharmaceuticals, Biotechnology & Life Sciences | |
| EV/FCFF, Industry | |
| Health Care | |
Based on: 10-K (reporting date: 2024-12-31).
1 Click competitor name to see calculations.
If the company EV/FCFF is lower then the EV/FCFF of benchmark then company is relatively undervalued.
Otherwise, if the company EV/FCFF is higher then the EV/FCFF of benchmark then company is relatively overvalued.
Enterprise Value to FCFF Ratio, Historical
Gilead Sciences Inc., historical EV/FCFF calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Enterprise value (EV)1 | ||||||
| Free cash flow to the firm (FCFF)2 | ||||||
| Valuation Ratio | ||||||
| EV/FCFF3 | ||||||
| Benchmarks | ||||||
| EV/FCFF, Competitors4 | ||||||
| AbbVie Inc. | ||||||
| Amgen Inc. | ||||||
| Bristol-Myers Squibb Co. | ||||||
| Danaher Corp. | ||||||
| Eli Lilly & Co. | ||||||
| Johnson & Johnson | ||||||
| Merck & Co. Inc. | ||||||
| Pfizer Inc. | ||||||
| Regeneron Pharmaceuticals Inc. | ||||||
| Thermo Fisher Scientific Inc. | ||||||
| Vertex Pharmaceuticals Inc. | ||||||
| EV/FCFF, Sector | ||||||
| Pharmaceuticals, Biotechnology & Life Sciences | ||||||
| EV/FCFF, Industry | ||||||
| Health Care | ||||||
Based on: 10-K (reporting date: 2024-12-31), 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).
3 2024 Calculation
EV/FCFF = EV ÷ FCFF
= ÷ =
4 Click competitor name to see calculations.
- Enterprise Value (EV)
- The enterprise value exhibited fluctuations over the period from 2020 to 2024. Initially, EV decreased from approximately 102.9 billion USD in 2020 to around 97.1 billion USD in 2021, indicating a contraction. This was followed by a substantial increase in 2022 to nearly 123.0 billion USD. A decline occurred again in 2023 to about 109.3 billion USD, before a pronounced rise to approximately 159.0 billion USD in 2024, marking the highest value in the observed timeframe.
- Free Cash Flow to the Firm (FCFF)
- Free cash flow showed variability but remained generally strong throughout the analyzed years. It increased notably from 7.6 billion USD in 2020 to a peak of 11.5 billion USD in 2021. Subsequently, FCFF decreased to 9.1 billion USD in 2022 and further to 8.2 billion USD in 2023. In 2024, FCFF recovered to reach 11.0 billion USD, close to the earlier peak levels.
- EV/FCFF Ratio
- The EV to FCFF ratio reflects valuation relative to free cash flow generation capacity. This ratio decreased sharply from 13.6 in 2020 to a low of 8.42 in 2021, driven by an increase in FCFF combined with a decline in EV. However, it rose again to 13.58 in 2022 and remained relatively stable in 2023 at 13.41. In 2024, the ratio increased further to 14.5, indicating a significant rise in enterprise value relative to free cash flow.
- Overall Trends and Insights
- There is evidence of volatility in both enterprise value and free cash flow to the firm over the five-year period. Enterprise value showed a general upward trend after dips in 2021 and 2023, culminating in a substantial increase in 2024, possibly reflecting market optimism or changes in business valuation. Free cash flow, after peaking in 2021, experienced a decline but rebounded in 2024. The EV/FCFF ratio's decrease in 2021 suggests improved valuation based on cash flow, while its increase afterward implies reduced valuation efficiency or market premium in later years. The elevated ratio in 2024 may indicate higher market expectations or perceived growth potential despite FCFF not exceeding the prior peak.