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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Micron Technology Inc. pages available for free this week:
- Balance Sheet: Assets
- Analysis of Long-term (Investment) Activity Ratios
- Enterprise Value to FCFF (EV/FCFF)
- Capital Asset Pricing Model (CAPM)
- Dividend Discount Model (DDM)
- Present Value of Free Cash Flow to Equity (FCFE)
- Return on Equity (ROE) since 2005
- Price to Earnings (P/E) since 2005
- Analysis of Revenues
- Analysis of Debt
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MVA
Micron Technology Inc., MVA calculation
US$ in millions
Based on: 10-K (reporting date: 2024-08-29), 10-K (reporting date: 2023-08-31), 10-K (reporting date: 2022-09-01), 10-K (reporting date: 2021-09-02), 10-K (reporting date: 2020-09-03), 10-K (reporting date: 2019-08-29).
1 Fair value of debt. See details »
2 Invested capital. See details »
The analysis of the annual financial data reveals several key trends and insights across the reported periods.
- Market (fair) value of Micron
-
The market value exhibited a general upward trend over the six-year period. Starting at 56,592 million USD in 2019, the value increased to 65,440 million USD in 2020, followed by a more significant rise to 83,749 million USD in 2021. However, a noticeable decline to 61,834 million USD occurred in 2022, indicating potential market challenges or external factors affecting valuation. The value rebounded strongly thereafter, reaching 88,456 million USD in 2023 and further surging to 125,309 million USD in 2024, marking the highest value in the dataset.
- Invested capital
-
Invested capital showed a steady increase from 38,774 million USD in 2019 to 42,291 million USD in 2020. This growth continued more gradually to 46,342 million USD in 2021, and then to 52,741 million USD in 2022. From 2022 onwards, the invested capital plateaued, maintaining near 53,000 million USD with 53,467 million USD in 2023 and a slight decrease to 53,327 million USD in 2024. This suggests that investment growth slowed or stabilized after 2022.
- Market value added (MVA)
-
The MVA, representing the difference between market value and invested capital, demonstrated significant variability. Initially, MVA increased from 17,818 million USD in 2019 to 23,149 million USD in 2020 and reached a peak of 37,407 million USD in 2021. A sharp decline to 9,093 million USD occurred in 2022, closely aligning with the drop in market value. Following this, MVA rebounded markedly to 34,989 million USD in 2023 and further to 71,982 million USD in 2024. Notably, the 2024 MVA approximates double the prior peak in 2021, indicating substantial value creation relative to invested capital in the most recent year.
MVA Spread Ratio
Micron Technology Inc., MVA spread ratio calculation, comparison to benchmarks
| Aug 29, 2024 | Aug 31, 2023 | Sep 1, 2022 | Sep 2, 2021 | Sep 3, 2020 | Aug 29, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Market value added (MVA)1 | |||||||
| Invested capital2 | |||||||
| Performance Ratio | |||||||
| MVA spread ratio3 | |||||||
| Benchmarks | |||||||
| MVA Spread Ratio, Competitors4 | |||||||
| Advanced Micro Devices Inc. | |||||||
| Analog Devices Inc. | |||||||
| Applied Materials Inc. | |||||||
| Broadcom Inc. | |||||||
| Intel Corp. | |||||||
| KLA Corp. | |||||||
| Lam Research Corp. | |||||||
| NVIDIA Corp. | |||||||
| Qualcomm Inc. | |||||||
| Texas Instruments Inc. | |||||||
Based on: 10-K (reporting date: 2024-08-29), 10-K (reporting date: 2023-08-31), 10-K (reporting date: 2022-09-01), 10-K (reporting date: 2021-09-02), 10-K (reporting date: 2020-09-03), 10-K (reporting date: 2019-08-29).
1 MVA. See details »
2 Invested capital. See details »
3 2024 Calculation
MVA spread ratio = 100 × MVA ÷ Invested capital
= 100 × ÷ =
4 Click competitor name to see calculations.
The analysis of the financial metrics over the six-year period reveals several notable trends and fluctuations.
- Market Value Added (MVA)
- The MVA exhibited an overall increasing trend with some volatility. Starting at 17,818 million US dollars in 2019, it rose steadily to 37,407 million in 2021, then sharply declined to 9,093 million in 2022. Subsequently, it recovered significantly, reaching 34,989 million in 2023 and nearly doubling to 71,982 million in 2024. This pattern indicates periods of strong value creation punctuated by a notable decline and a subsequent robust recovery.
- Invested Capital
- Invested capital showed a consistent growth trajectory from 38,774 million US dollars in 2019 to a peak of 53,741 million in 2022. After that, the capital slightly increased to 53,467 million in 2023, followed by a marginal decrease to 53,327 million in 2024. The overall trend suggests steady investment over the years with stabilization in the most recent periods.
- MVA Spread Ratio
- The MVA spread ratio followed a pattern similar to the MVA, starting at 45.95% in 2019 and rising to a high of 80.72% in 2021. It then plummeted to 17.24% in 2022, indicating a significant reduction in market value added relative to the invested capital during that year. The ratio rebounded to 65.44% in 2023 and surged impressively to 134.98% in 2024, suggesting an exceptional enhancement in value creation relative to invested capital in the most recent year.
In summary, the data indicate robust growth in market value added and efficiency in capital utilization over the period, despite a pronounced dip in 2022. The recovery and subsequent surge in both MVA and its spread ratio by 2024 reflect a strong turnaround and improved market perception of the company’s value generation capabilities relative to its invested capital base.
MVA Margin
Micron Technology Inc., MVA margin calculation, comparison to benchmarks
| Aug 29, 2024 | Aug 31, 2023 | Sep 1, 2022 | Sep 2, 2021 | Sep 3, 2020 | Aug 29, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Market value added (MVA)1 | |||||||
| Revenue | |||||||
| Performance Ratio | |||||||
| MVA margin2 | |||||||
| Benchmarks | |||||||
| MVA Margin, Competitors3 | |||||||
| Advanced Micro Devices Inc. | |||||||
| Analog Devices Inc. | |||||||
| Applied Materials Inc. | |||||||
| Broadcom Inc. | |||||||
| Intel Corp. | |||||||
| KLA Corp. | |||||||
| Lam Research Corp. | |||||||
| NVIDIA Corp. | |||||||
| Qualcomm Inc. | |||||||
| Texas Instruments Inc. | |||||||
Based on: 10-K (reporting date: 2024-08-29), 10-K (reporting date: 2023-08-31), 10-K (reporting date: 2022-09-01), 10-K (reporting date: 2021-09-02), 10-K (reporting date: 2020-09-03), 10-K (reporting date: 2019-08-29).
1 MVA. See details »
2 2024 Calculation
MVA margin = 100 × MVA ÷ Revenue
= 100 × ÷ =
3 Click competitor name to see calculations.
- Market Value Added (MVA)
- The Market Value Added exhibited a generally upward trend over the examined periods, with some fluctuations. Starting from 17,818 million USD in 2019, it increased significantly to 23,149 million USD in 2020 and further to 37,407 million USD in 2021. However, in 2022, there was a pronounced decline to 9,093 million USD, followed by a recovery to 34,989 million USD in 2023 and then a substantial rise to 71,982 million USD in 2024. This pattern suggests volatility in market value contribution but an overall strong positive trajectory by the end of the period.
- Revenue
- Revenue demonstrated variability with an initial decline from 23,406 million USD in 2019 to 21,435 million USD in 2020. Subsequently, revenues increased progressively reaching 27,705 million USD in 2021 and 30,758 million USD in 2022, indicating growth momentum. However, there was a sharp decrease in 2023 to 15,540 million USD. The revenue rebounded in 2024 to 25,111 million USD but did not recover to the peak level seen in 2022. This suggests fluctuations potentially driven by market or operational factors affecting sales.
- MVA Margin
- The MVA Margin, reflecting the relationship between market value added and revenue, showed considerable variation and a general upward trend. Starting at 76.12% in 2019, it increased markedly to 108% in 2020 and 135.02% in 2021. Despite a significant decline to 29.56% in 2022, it surged dramatically to 225.16% in 2023 and further to 286.66% in 2024. This sharp increase in 2023 and 2024 suggests improved value creation efficiency relative to revenue, possibly due to market revaluation or enhanced profitability.