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.
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- Income Statement
- Common-Size Balance Sheet: Assets
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Solvency Ratios
- Analysis of Reportable Segments
- Enterprise Value to FCFF (EV/FCFF)
- Dividend Discount Model (DDM)
- Net Profit Margin since 2015
- Total Asset Turnover since 2015
- Price to Operating Profit (P/OP) since 2015
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MVA
Kraft Heinz Co., MVA calculation
US$ in millions
Based on: 10-K (reporting date: 2019-12-28), 10-K (reporting date: 2018-12-29), 10-K (reporting date: 2017-12-30), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
1 Fair value of debt. See details »
2 Invested capital. See details »
- Market (fair) value of Kraft Heinz
- The market value of the company showed an initial upward trend from 2015 to 2016, increasing from approximately $120.5 billion to nearly $147 billion. However, in the subsequent years, there was a pronounced decline, with the value dropping sharply to about $65.9 billion in 2018 and further slightly decreasing to roughly $64.7 billion by the end of 2019.
- Invested capital
- Invested capital exhibited a modest growth from 2015 to 2017, rising from approximately $105.1 billion to $112 billion. Subsequently, this value decreased in 2018 to about $96.5 billion and then slightly more to $94.3 billion in 2019, indicating a contraction in invested resources during the latter years analyzed.
- Market value added (MVA)
- Market value added reflected a positive position in the initial years, increasing significantly from $15.4 billion in 2015 to a peak of $35.6 billion in 2016. This was followed by a substantial decline, as MVA dropped to $7.9 billion in 2017 and subsequently moved into negative territory in 2018 and 2019, at approximately -$30.7 billion and -$29.6 billion respectively. This shift suggests that the market value underperformed compared to the invested capital during the later years.
MVA Spread Ratio
Kraft Heinz Co., MVA spread ratio calculation, comparison to benchmarks
| Dec 28, 2019 | Dec 29, 2018 | Dec 30, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Market value added (MVA)1 | ||||||
| Invested capital2 | ||||||
| Performance Ratio | ||||||
| MVA spread ratio3 | ||||||
| Benchmarks | ||||||
| MVA Spread Ratio, Competitors4 | ||||||
| Coca-Cola Co. | ||||||
| Mondelēz International Inc. | ||||||
| PepsiCo Inc. | ||||||
| Philip Morris International Inc. | ||||||
Based on: 10-K (reporting date: 2019-12-28), 10-K (reporting date: 2018-12-29), 10-K (reporting date: 2017-12-30), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
1 MVA. See details »
2 Invested capital. See details »
3 2019 Calculation
MVA spread ratio = 100 × MVA ÷ Invested capital
= 100 × ÷ =
4 Click competitor name to see calculations.
- Market Value Added (MVA)
- The Market Value Added shows significant fluctuation over the five-year period. It increased sharply from approximately 15.4 billion US dollars in 2015 to 35.6 billion US dollars in 2016, indicating a strong positive performance. However, this was followed by a notable decline in 2017 to about 7.9 billion US dollars, and then a substantial negative shift in both 2018 and 2019, with values of approximately -30.7 billion and -29.6 billion US dollars respectively. This negative MVA suggests that the company’s market value fell below the capital invested, reflecting diminished investor confidence or deteriorating market perceptions during the latter years.
- Invested Capital
- Invested capital remained relatively stable but showed a slight downward trend over the period. Starting from about 105.1 billion US dollars in 2015, it increased marginally to 111.4 billion in 2016 and 112.0 billion in 2017, before decreasing to 96.5 billion in 2018 and 94.3 billion in 2019. The decrease in invested capital in the last two years might reflect divestitures, asset write-downs, or a strategic reduction in capital expenditure.
- MVA Spread Ratio
- The MVA spread ratio, which measures the percentage difference between market value added and invested capital, exhibited a volatile trend. It rose from 14.66% in 2015 to a peak of 31.94% in 2016, suggesting strong value creation relative to invested capital in those years. However, there was a sharp reversal from 2017 onward with the ratio falling to 7.07% in 2017 and plunging into negative territory at -31.79% and -31.44% in 2018 and 2019 respectively. These negative values confirm the significant decline in market value relative to invested capital, indicating value destruction or poor market performance in the later years.
- Overall Analysis
- The overall trend indicates that the company experienced a period of robust market value addition and capital efficiency during 2015 and 2016, followed by a pronounced downturn starting in 2017. The sustained negative MVA and MVA spread ratio in 2018 and 2019 imply challenges in generating shareholder value and potentially underline operational or strategic issues affecting market perception and financial health.
MVA Margin
Kraft Heinz Co., MVA margin calculation, comparison to benchmarks
| Dec 28, 2019 | Dec 29, 2018 | Dec 30, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Market value added (MVA)1 | ||||||
| Net sales | ||||||
| Performance Ratio | ||||||
| MVA margin2 | ||||||
| Benchmarks | ||||||
| MVA Margin, Competitors3 | ||||||
| Coca-Cola Co. | ||||||
| Mondelēz International Inc. | ||||||
| PepsiCo Inc. | ||||||
| Philip Morris International Inc. | ||||||
Based on: 10-K (reporting date: 2019-12-28), 10-K (reporting date: 2018-12-29), 10-K (reporting date: 2017-12-30), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
1 MVA. See details »
2 2019 Calculation
MVA margin = 100 × MVA ÷ Net sales
= 100 × ÷ =
3 Click competitor name to see calculations.
- Market Value Added (MVA)
- The Market Value Added demonstrates significant volatility over the analyzed period. Starting at 15,408 million US dollars in 2015, it experienced a notable increase, peaking at 35,570 million in 2016. However, following this peak, a sharp decline is evident, with MVA falling to 7,914 million in 2017 and turning negative in 2018 and 2019, recording -30,691 million and -29,649 million respectively. This suggests a marked decrease in market valuation relative to invested capital in the latter years.
- Net Sales
- Net sales showed growth from 2015 to 2016, rising from 18,338 million to 26,487 million US dollars. The subsequent years, 2017 and 2018, saw stabilization in sales volumes at around 26,200 million. In 2019, a minor decline is observed, with net sales decreasing to 24,977 million. Overall, net sales increased substantially in the earlier years but faced slight contraction towards the end of the period.
- MVA Margin
- The MVA margin, measured as a percentage, mirrors the trend observed in the Market Value Added. Starting at a robust 84.02% in 2015, it rose sharply to 134.29% in 2016, reflecting strong market value growth relative to net sales. Thereafter, the margin declined significantly to 30.17% in 2017 and turned sharply negative in the final two years, dropping to -116.84% in 2018 and further to -118.7% in 2019. This negative margin indicates that market value losses substantially exceeded net sales during those years.
- Overall Analysis
- The data indicates that although net sales remained relatively stable with slight growth initially and minor decline later, the company's market value performance deteriorated drastically after 2016. The negative MVA and MVA margin in the last two years highlight a disconnect between operational sales performance and market valuation. Such trends may reflect external market pressures, investor sentiment, or operational challenges impacting overall market perception despite stable sales figures.