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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- Net Cash Provided by Operating Activities
- There is a consistent upward trend in net cash provided by operating activities over the five-year period. Starting from approximately $900.1 million in 2018, the figure increased steadily each year, reaching about $1.69 billion in 2022. This represents a growth of nearly 88% over the period, highlighting strong operational cash generation capabilities and potential improvements in core business performance or efficiency.
- Free Cash Flow to the Firm (FCFF)
- Free cash flow to the firm also exhibits an overall increasing trend, moving from around $324.6 million in 2018 to approximately $943.9 million in 2022. There was a significant spike observed from 2018 to 2020, nearly doubling within this timeframe. The amount stabilized somewhat during 2021 but increased again sharply in 2022. This pattern suggests effective capital expenditure management along with sustained operating cash flows that support growing free cash flow generation, enabling potential reinvestment or debt reduction.
- Overall Insights
- The data reveals robust financial health with improving liquidity and cash generation capacity. The upward trajectories in operating cash and free cash flow imply enhanced operational efficiency and prudent financial management. The substantial increases in these cash metrics indicate a positive trajectory for sustaining growth and flexibility for strategic financial decisions.
Interest Paid, Net of Tax
Old Dominion Freight Line Inc., interest paid, net of tax calculation
US$ 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
- Effective income tax rate (EITR)
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The effective income tax rate demonstrates relative stability over the five-year period. It shows a slight decrease from 25.73% in 2018 to 25.21% in 2022, with minor fluctuations around the mid-25% range each year. This indicates a consistent tax burden without significant variations impacting after-tax profitability.
- Interest paid, net of tax
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Interest expense, net of tax, exhibits variability throughout the years. Beginning at $3,361 thousand in 2018, it declines to $2,881 thousand in 2019, increases notably to $4,243 thousand in 2020, then decreases again to $3,153 thousand in 2021 and further to $2,956 thousand in 2022. This fluctuation may suggest changes in debt levels or interest rates affecting interest costs during this period.
- Capitalized interest, net of tax
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The capitalized interest, net of tax, generally remains within a similar range, beginning at $2,404 thousand in 2018 and seeing a decline to $1,846 thousand in 2020. After that, it increases moderately to $1,978 thousand in 2021, followed by a rise to $2,438 thousand in 2022, slightly surpassing the initial level. This pattern indicates adjustments in capital expenditure activities or capitalization policies over time.
Enterprise Value to FCFF Ratio, Current
Old Dominion Freight Line Inc., current EV/FCFF calculation, comparison to benchmarks
| Selected Financial Data (US$ 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. | 18.24 |
| Uber Technologies Inc. | 25.44 |
| Union Pacific Corp. | 23.36 |
| United Airlines Holdings Inc. | 8.60 |
| United Parcel Service Inc. | 12.42 |
| EV/FCFF, Sector | |
| Transportation | 23.57 |
| EV/FCFF, Industry | |
| Industrials | 32.48 |
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 | 26.42 | 25.20 | — | — | |
| United Airlines Holdings Inc. | 11.88 | 79.24 | — | — | — | |
| United Parcel Service Inc. | 16.63 | 16.95 | 28.23 | — | — | |
| EV/FCFF, Sector | ||||||
| Transportation | 21.76 | 24.81 | 184.17 | — | — | |
| EV/FCFF, Industry | ||||||
| Industrials | 24.30 | 28.80 | 189.49 | — | — | |
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.
- Enterprise Value (EV)
- The enterprise value demonstrates a consistent upward trajectory over the period analyzed. Starting from approximately 12.06 billion USD at the end of 2018, it increased steadily each year, reaching about 37.49 billion USD by the end of 2022. This reflects a more than threefold increase, suggesting substantial growth in the company's market valuation and overall size.
- Free Cash Flow to the Firm (FCFF)
- Free cash flow to the firm also shows a general positive trend, rising from 324.6 million USD at the end of 2018 to 943.9 million USD by the end of 2022. Although there was a slight decrease in 2021 compared to 2020, the overall upward movement indicates improved cash generation capabilities available to all capital providers over the long term.
- EV/FCFF Ratio
- The EV to FCFF ratio exhibits fluctuations over the period. It started relatively high at 37.17 in 2018, then decreased to 31.20 in 2019, followed by an increase to 34.53 in 2020. The ratio peaked sharply at 46.32 in 2021 before declining to 39.72 in 2022. These movements suggest varying degrees of market valuation relative to free cash flow, with the peak in 2021 possibly indicating a temporary market premium or earnings adjustment during that year. The subsequent decline in 2022 shows a partial normalization but still a relatively high valuation multiple compared to earlier periods.
- Summary Insight
- The company experienced substantial growth in enterprise value and free cash flow over the five-year span, indicating expansion and improved cash-generating efficiency. However, the volatility in the EV/FCFF ratio points to dynamic market perceptions and valuation adjustments. While the rising enterprise value aligns with stronger free cash flow, the changes in the multiple suggest investors recalibrating expectations of future performance or risk during the period.