Enterprise Value to FCFF (EV/FCFF)
Free Cash Flow to The Firm (FCFF)
Old Dominion Freight Line Inc., FCFF calculation
US$ in thousands
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
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Analysis of cash flow trends from 2018 to 2022 indicates a sustained expansion in both operating cash generation and free cash flow to the firm (FCFF), reflecting an overall increase in the capacity to generate liquidity.
- Net Cash Provided by Operating Activities
- A consistent upward trajectory is observed, with values increasing from 900,116 thousand US dollars in 2018 to 1,691,582 thousand US dollars by the end of 2022. Although a marginal decline occurred in 2020, the subsequent recovery was aggressive, with the most significant year-over-year increase appearing between 2021 and 2022, representing an approximate growth of 39.5%.
- Free Cash Flow to the Firm (FCFF)
- FCFF exhibited substantial growth over the five-year period, rising from 324,572 thousand US dollars in 2018 to 943,925 thousand US dollars in 2022. The growth was particularly pronounced between 2018 and 2020. A slight contraction was noted in 2021, where FCFF fell to 687,208 thousand US dollars, before rebounding strongly in 2022.
- Cash Flow Correlation and Efficiency
- The relationship between operating cash and FCFF suggests fluctuating capital allocation patterns. In 2020, FCFF represented a high percentage of operating cash, indicating lower capital expenditures relative to cash inflow. Conversely, in 2021, FCFF decreased despite a substantial increase in net cash provided by operating activities, which points to a significant increase in capital investments or firm-level expenditures during that fiscal year.
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Interest Paid, Net of Tax
Old Dominion Freight Line Inc., interest paid, net of tax calculation
US$ in thousands
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
2 2022 Calculation
Interest paid, tax = Interest paid × EITR
= 3,953 × 25.21% = 997
3 2022 Calculation
Capitalized interest, tax = Capitalized interest × EITR
= 3,260 × 25.21% = 822
The financial data indicates a fluctuating trend in interest expenses net of tax over the five-year period from 2018 to 2022, characterized by a notable peak in 2020 followed by a period of decline.
- Interest Paid Analysis
- Interest paid, net of tax, exhibited variability, starting at US$ 3,361 thousand in 2018 and decreasing to US$ 2,881 thousand in 2019. A significant increase occurred in 2020, reaching a peak of US$ 4,243 thousand, representing the highest expenditure in the observed period. Subsequently, a downward trend followed, with values falling to US$ 3,153 thousand in 2021 and further to US$ 2,956 thousand by the end of 2022.
- Capitalized Interest Trends
- Capitalized interest, net of tax, followed a trajectory inverse to interest paid during the 2020 peak. After remaining relatively stable between 2018 and 2019 at approximately US$ 2,300 to US$ 2,400 thousand, the amount dipped to its lowest point of US$ 1,846 thousand in 2020. This figure recovered steadily over the following two years, returning to US$ 2,438 thousand by December 31, 2022.
- Tax Rate Stability
- The effective income tax rate remained remarkably consistent throughout the five-year window, fluctuating minimally between 25.21% and 25.73%. This stability suggests that the changes observed in the net-of-tax interest figures are driven by shifts in gross interest costs or capitalization decisions rather than fluctuations in the corporate tax environment.
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Enterprise Value to FCFF Ratio, Current
Old Dominion Freight Line Inc., current EV/FCFF calculation, comparison to benchmarks
| Selected Financial Data (US$ in thousands) | |
| Enterprise value (EV) | 44,348,423) |
| Free cash flow to the firm (FCFF) | 943,925) |
| Valuation Ratio | |
| EV/FCFF | 46.98 |
| Benchmarks | |
| EV/FCFF, Competitors1 | |
| FedEx Corp. | 14.98 |
| Uber Technologies Inc. | 14.39 |
| Union Pacific Corp. | 31.80 |
| United Airlines Holdings Inc. | 12.55 |
| United Parcel Service Inc. | 20.04 |
| EV/FCFF, Sector | |
| Transportation | 26.31 |
| EV/FCFF, Industry | |
| Industrials | 34.43 |
Based on: 10-K (reporting date: 2022-12-31).
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
Old Dominion Freight Line Inc., historical EV/FCFF calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Enterprise value (EV)1 | 37,494,435) | 31,829,677) | 24,779,831) | 16,081,385) | 12,064,500) | |
| Free cash flow to the firm (FCFF)2 | 943,925) | 687,208) | 717,722) | 515,467) | 324,572) | |
| Valuation Ratio | ||||||
| EV/FCFF3 | 39.72 | 46.32 | 34.53 | 31.20 | 37.17 | |
| Benchmarks | ||||||
| EV/FCFF, Competitors4 | ||||||
| FedEx Corp. | 19.13 | 18.72 | — | — | — | |
| Uber Technologies Inc. | 136.28 | — | — | — | — | |
| Union Pacific Corp. | 23.83 | 26.41 | — | — | — | |
| United Airlines Holdings Inc. | 11.88 | 79.24 | — | — | — | |
| United Parcel Service Inc. | 16.83 | 16.98 | — | — | — | |
| EV/FCFF, Sector | ||||||
| Transportation | 21.84 | 24.82 | — | — | — | |
| EV/FCFF, Industry | ||||||
| Industrials | 24.33 | 28.81 | — | — | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
3 2022 Calculation
EV/FCFF = EV ÷ FCFF
= 37,494,435 ÷ 943,925 = 39.72
4 Click competitor name to see calculations.
The financial performance from 2018 to 2022 is characterized by a substantial expansion in enterprise value and a corresponding, though less linear, increase in free cash flow to the firm. The relationship between these two metrics indicates a general trend of increasing valuation multiples over the analyzed period.
- Enterprise Value Trends
- A consistent and rapid increase is observed in the enterprise value, which rose from 12,064,500 thousand USD in 2018 to 37,494,435 thousand USD by the end of 2022. This represents a sustained upward trajectory, indicating significant growth in the overall market valuation of the entity.
- Free Cash Flow to the Firm (FCFF) Performance
- FCFF demonstrated a general upward trend, increasing from 324,572 thousand USD in 2018 to 943,925 thousand USD in 2022. A temporary contraction occurred in 2021, where FCFF declined to 687,208 thousand USD from the 717,722 thousand USD reported in 2020, before recovering strongly in the final year of the period.
- EV/FCFF Ratio Dynamics
- The EV/FCFF ratio exhibited volatility, moving from 37.17 in 2018 to a peak of 46.32 in 2021. The sharp increase in the ratio during 2021 is attributable to the simultaneous rise in enterprise value and the slight decrease in free cash flow. In 2022, the ratio moderated to 39.72, as the significant growth in FCFF partially offset the continued increase in enterprise value.
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