Enterprise Value to FCFF (EV/FCFF)
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Honeywell International Inc. pages available for free this week:
- Common-Size Balance Sheet: Assets
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Common Stock Valuation Ratios
- Price to FCFE (P/FCFE)
- Dividend Discount Model (DDM)
- Present Value of Free Cash Flow to Equity (FCFE)
- Price to Earnings (P/E) since 2005
- Price to Book Value (P/BV) since 2005
- Price to Sales (P/S) since 2005
- Analysis of Revenues
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Free Cash Flow to The Firm (FCFF)
Honeywell International 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 exhibits a declining trend from 2020 to 2022, decreasing from $6,208 million to $5,274 million. This reduction reflects a contraction in cash inflows from core business operations. In 2023, the figure stabilizes slightly at $5,340 million, indicating a modest recovery or stabilization of operating cash generation. By 2024, there is a noticeable improvement, with net operating cash rising to $6,097 million, approaching the level noted in 2020.
- Free Cash Flow to the Firm (FCFF)
- The FCFF shows a similar pattern to net operating cash flows, beginning at $5,625 million in 2020 and declining consistently through 2022, reaching $4,829 million. This suggests that after accounting for capital expenditures and working capital changes, the cash available to all capital providers diminished over this period. Stability is observed in 2023 as FCFF holds steady at $4,858 million, followed by a strong rebound in 2024, returning to the original 2020 level of $5,625 million.
- Overall Analysis
- Both operating cash flow and free cash flow experienced a downward trend from 2020 through 2022, possibly reflecting operational challenges or increased investment needs during these years. From 2023 onward, both metrics stabilize and then demonstrate recovery by 2024, suggesting improved operational efficiency, better cash management, or favorable market conditions. The parallel movement of net operating cash and FCFF indicates consistent capital expenditure and working capital treatment over the period. The rebound in 2024 underscores a positive cash flow outlook.
Interest Paid, Net of Tax
Honeywell International Inc., interest paid, net of tax calculation
US$ 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 exhibits a modest upward trend from 19.1% in 2020 to a peak of 22.5% in 2021. Following this increase, there is a gradual decline over the subsequent years, reaching 20.4% in 2024. This pattern suggests an initial rise in tax burden followed by a slight easing, though the final rate remains higher than the starting point in 2020.
- Interest Paid, Net of Amounts Capitalized, Net of Tax
- Interest payments show a significant increase throughout the period analyzed. Starting at $266 million in 2020, the amount remains relatively stable in 2021 at $263 million. However, from 2022 onward, there is a sharp escalation, with payments rising to $292 million, then surging to $514 million in 2023 and reaching $692 million in 2024. This substantial growth indicates a notable increase in the company's interest expenses, potentially reflecting higher debt levels or rising borrowing costs during the period.
Enterprise Value to FCFF Ratio, Current
Honeywell International Inc., current EV/FCFF calculation, comparison to benchmarks
| Selected Financial Data (US$ in millions) | |
| Enterprise value (EV) | |
| Free cash flow to the firm (FCFF) | |
| Valuation Ratio | |
| EV/FCFF | |
| Benchmarks | |
| EV/FCFF, Competitors1 | |
| Boeing Co. | |
| Caterpillar Inc. | |
| Eaton Corp. plc | |
| GE Aerospace | |
| Lockheed Martin Corp. | |
| RTX Corp. | |
| EV/FCFF, Sector | |
| Capital Goods | |
| EV/FCFF, Industry | |
| Industrials | |
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
Honeywell International 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 | ||||||
| Boeing Co. | ||||||
| Caterpillar Inc. | ||||||
| Eaton Corp. plc | ||||||
| GE Aerospace | ||||||
| Lockheed Martin Corp. | ||||||
| RTX Corp. | ||||||
| EV/FCFF, Sector | ||||||
| Capital Goods | ||||||
| EV/FCFF, Industry | ||||||
| Industrials | ||||||
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 a fluctuating trend over the five-year period. Beginning at approximately $149 billion in 2020, it declined to around $137 billion in 2021, followed by an increase to roughly $144 billion in 2022. The value slightly decreased again in 2023 to about $142 billion before rising noticeably to approximately $152 billion in 2024. Overall, the enterprise value showed moderate volatility with a net increase by the end of the period.
- Free Cash Flow to the Firm (FCFF)
- The free cash flow to the firm demonstrated a generally stable pattern with minor fluctuations. Starting at $5.625 billion in 2020, it decreased to $5.433 billion in 2021 and further to $4.829 billion in 2022. It then experienced a slight recovery to $4.858 billion in 2023 and returned to the initial level of $5.625 billion in 2024. This indicates a resilient cash flow generation capability, despite intermediate dips.
- EV to FCFF Ratio
- The EV/FCFF ratio presented variability consistent with the movements in both enterprise value and free cash flow. The ratio began at 26.49 in 2020, decreased to 25.22 in 2021, then increased notably to 29.82 in 2022. It experienced a marginal decline to 29.13 in 2023 and further reduction to 27.10 in 2024. These fluctuations suggest changing market valuations relative to cash flow, with the highest valuation multiples occurring in 2022 and 2023 before moderating in 2024.
- Summary of Trends and Insights
- Overall, the company’s enterprise value and free cash flow displayed somewhat cyclical movements across the five years, with enterprise value showing greater volatility. Free cash flow decreased notably between 2020 and 2022 but recovered by 2024, indicating a rebound in cash generating efficiency. The EV/FCFF ratio, a valuation metric, peaked in the middle years, implying periods where the market valued the firm higher relative to its cash flow, followed by a slight correction. This dynamic may reflect changes in investor sentiment, operational performance, or broader market conditions during the observed period. The returns to initial cash flow levels while the enterprise value increased by the end suggests a positive shift in perceived value or growth prospects as of 2024.