Moderna Inc. (NASDAQ:MRNA)

Net Operating Profit After Taxes (NOPAT)

The NOPAT figure exhibited substantial volatility over the analyzed period. In 2019, the company recorded a significant operating loss of 605 million USD. However, there was a marked recovery in 2020, with NOPAT increasing sharply to 3.1 billion USD, followed by an even more pronounced rise to 14.7 billion USD in 2021. Subsequently, the NOPAT declined considerably to 3.5 billion USD in 2022 and further deteriorated to a loss of 5.4 billion USD by the end of 2023. This indicates high fluctuations in operational profitability within the span of five years, with peak performance occurring in 2021.

Cost of Capital

The company's cost of capital demonstrated a gradual and slight downward trend, decreasing from 21.72% in 2019 to 21.33% in 2023. This consistent reduction, albeit modest, suggests a very slight improvement in the company’s risk profile or capital structure efficiency during this period.

Invested Capital

Invested capital expanded substantially from 481 million USD in 2019 to a peak of 10.7 billion USD in 2021, indicating aggressive investment or growth initiatives during these years. However, following this peak, invested capital decreased notably to 7.1 billion USD in 2022 and further to 5.3 billion USD in 2023. This decline may reflect a divestment strategy, asset write-downs, or a reduction in operating scale after the 2021 peak.

Economic Profit

The economic profit trend closely mirrored that of NOPAT, showing negative results in 2019 (-710 million USD), a strong recovery and peak in 2021 (12.4 billion USD), followed by a sharp decline to 1.99 billion USD in 2022 and then a considerable negative value of -6.5 billion USD in 2023. Economic profit being negative in two separate years suggests instances of value destruction during those periods, while the peak in 2021 represents significant value generation. The decline in economic profit despite a decreasing cost of capital highlights deteriorating operational performance or inefficiencies outweighing capital cost improvements.

The financial data reveals significant fluctuations in the company's profitability over the five-year period. The net income (loss) experienced a substantial improvement from 2019 to 2021, transitioning from negative figures in 2019 and 2020 to a strong positive net income in 2021. This peak was followed by a decline in 2022 and a return to negative net income in 2023.

Similarly, the net operating profit after taxes (NOPAT) reflects this volatility. In 2019, the NOPAT was negative but shifted to a positive value in 2020, with a remarkable increase reaching its highest point in 2021. After peaking, there was a steep decline in 2022 and further deterioration in 2023, resulting in negative NOPAT.

Net Income (Loss) Trend

From a loss of $514 million in 2019 worsening to a loss of $747 million in 2020, the company reversed its fortunes dramatically in 2021, generating a net income of $12,202 million. This profit decreased to $8,362 million in 2022 and swung back to a loss of $4,714 million in 2023.

Net Operating Profit After Taxes (NOPAT) Trend

Consistent with net income, NOPAT started negative at -$605 million in 2019, rose sharply to $3,091 million in 2020, then peaked at $14,737 million in 2021. The metric then declined to $3,520 million in 2022 and further dropped to -$5,414 million by 2023, displaying high volatility and indicating challenges in operational profitability towards the end of the period.

Overall Insight

The data demonstrates a peak in financial performance in 2021, followed by notable declines in subsequent years. The sharp swings between profit and loss suggest potential external or internal factors influencing operational efficiency and market conditions. The negative results in 2023 highlight recent financial challenges and may warrant further investigation into cost structures, revenue streams, or market dynamics.

The financial data exhibits notable fluctuations in the provision for income taxes as well as cash operating taxes over the five-year period.

Provision for (benefit from) income taxes

There is a clear upward trend from 2019 through 2022, starting with a benefit of US$ -1 million in 2019, rising to a modest provision of US$ 3 million in 2020, and then surging significantly to US$ 1,083 million in 2021 and further to US$ 1,213 million in 2022. However, in 2023, the provision decreased to US$ 772 million, indicating a partial reversal from the previous two years but still remaining at a substantially higher level than in 2019 and 2020.

Cash operating taxes

The cash operating taxes similarly show variability with a negative outflow of US$ -4 million in 2019, followed by a small positive figure of US$ 1 million in 2020. Thereafter, there is a sharp increase to US$ 1,381 million in 2021 and US$ 1,763 million in 2022, mirroring the upward trend seen in the provision for income taxes. Notably, in 2023 the cash operating taxes turn negative again at US$ -191 million, which contrasts starkly with the two previous years and suggests unusual tax-related cash flows or adjustments.

Overall, both provisions for income taxes and cash operating taxes remain low in the initial years before escalating steeply during 2021 and 2022, likely reflecting increased taxable income or changes in tax rates or rules during that period. The drop in 2023 for both measures, especially the negative cash operating taxes, may warrant further investigation as it suggests atypical tax events or benefits impacting cash flows.

The financial data over the five-year period exhibit notable fluctuations in the key metrics of total reported debt and leases, stockholders' equity, and invested capital.

Total Reported Debt & Leases

The total reported debt and leases increased consistently each year from 2019 to 2023. Starting at US$136 million in 2019, it rose sharply to US$238 million in 2020 and then accelerated to US$916 million in 2021. The upward trend continued but at a moderated pace with values reaching US$1,200 million in 2022 and US$1,243 million in 2023. This pattern suggests a notable increase in leverage, especially between 2019 and 2021, followed by a stabilization at a higher debt level.

Stockholders’ Equity

Stockholders’ equity showed a dramatic rise in 2021 after more moderate growth in the early years. Beginning at US$1,175 million in 2019, the equity more than doubled to US$2,561 million in 2020. It then surged to US$14,145 million in 2021 and continued to grow to US$19,123 million in 2022. However, in 2023, there was a significant decline to US$13,854 million. This peak followed by contraction indicates volatility in the company’s net assets, potentially reflecting market valuation changes or dividend payments.

Invested Capital

Invested capital experienced substantial volatility, showing an initial increase from US$481 million in 2019 to a peak of US$10,693 million in 2021. Following this peak, there was a sharp decline to US$7,126 million in 2022 and a further decrease to US$5,263 million in 2023. The sharp rise and subsequent decline suggest significant shifts in the company’s invested resources, which may be due to asset acquisitions or disposals, changes in working capital, or shifts in capital allocation strategies.

Overall, the data reveal a period of significant expansion in both debt and equity financing up to 2021 or 2022, followed by signs of retraction or adjustment in 2023. The increase in leverage alongside the rise in equity points to aggressive growth or investment phases, while the subsequent declines in equity and invested capital indicate possible strategic repositioning or market-related adjustments.

The financial data demonstrates significant fluctuations over the five-year period under review. An analysis of economic profit reveals a highly volatile performance. Initially, there was a substantial economic loss in 2019, with economic profit recorded at negative US$710 million. This was followed by a notable recovery and strong positive economic profit in 2020 and 2021, peaking at US$12,426 million. However, this was not sustained, as economic profit sharply declined to US$1,989 million in 2022 and further deteriorated to a negative value of US$6,537 million in 2023.

Invested capital follows a somewhat related trend, starting from a relatively low base of US$481 million in 2019 and increasing significantly to US$10,693 million in 2021, indicating considerable capital deployment during the period of positive economic profit. In the following years, invested capital decreased to US$7,126 million in 2022 and further to US$5,263 million in 2023, suggesting divestitures or write-downs possibly corresponding with the decline in economic profit.

The economic spread ratio, a measure of the return generated on invested capital relative to the cost of capital, reflects these trends vividly. The ratio was deeply negative in 2019 (-147.59%), indicating a poor return relative to the cost of capital. It improved dramatically in 2020 and 2021, reaching a high of 116.21%, signaling strong value creation during this period. Nonetheless, this positive trend reversed significantly in the last two years, dropping to 27.91% in 2022 and falling into a negative territory at -124.2% in 2023, corroborating the economic profit trend and suggesting a deterioration in operating performance or increased cost pressures.

Overall, the data suggest a company that experienced a remarkable growth and profitability phase between 2020 and 2021, supported by increased capital investment. However, this was followed by a marked decline in economic profitability and efficiency in the subsequent years, accompanied by a reduction in invested capital. These trends point towards potential challenges in sustaining profitability or shifts in business strategy or market conditions during the latter period.

The financial data over the five-year period reveals significant fluctuations in key performance indicators. A detailed review of economic profit, adjusted net product sales, and economic profit margin uncovers notable trends and dynamics in the company's financial health and market performance.

Economic Profit

Initially, the economic profit was negative at -710 million US dollars, reflecting losses. This reversed dramatically in the following year, surging to a positive 2,177 million US dollars, and then achieving a peak at 12,426 million US dollars in 2021. However, in 2022, economic profit declined substantially to 1,989 million US dollars and further deteriorated to a negative position of -6,537 million US dollars in 2023. This volatility indicates a highly unstable profitability pattern, with a peak in operational efficiency followed by sharp declines in the later years.

Adjusted Net Product Sales

Sales performance demonstrated a marked expansion starting from a slight negative value of -72 million US dollars in 2019 to a substantial increase of 4,042 million US dollars in 2020. Sales then experienced robust growth to 20,499 million US dollars in 2021, before declining in subsequent years to 14,278 million US dollars in 2022 and further to 4,611 million US dollars by 2023. This indicates that peak product sales were realized in 2021, followed by a significant contraction in the ensuing periods.

Economic Profit Margin

The economic profit margin displayed a positive trajectory from 53.86% in 2020 to a high of 60.62% in 2021. This was followed by a sharp decline to 13.93% in 2022, ultimately descending into a negative margin of -141.76% by 2023. This margin trend reflects a peak in profitability as a percentage of sales, followed by erosion of margin profitability, culminating in substantial losses relative to sales in the most recent year.

Overall, the data suggests that the period leading up to and including 2021 was characterized by strong profitability and sales growth. However, the subsequent years showed a pronounced downturn in both economic profit and sales, accompanied by a severe decline in profit margins. These patterns may be indicative of declining product demand, increased costs, or other operational challenges impacting financial performance in the latter years.