Enterprise Value to FCFF (EV/FCFF)
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Shockwave Medical Inc. pages available for free this week:
- Balance Sheet: Assets
- Balance Sheet: Liabilities and Stockholders’ Equity
- Cash Flow Statement
- Common-Size Income Statement
- Analysis of Solvency Ratios
- Analysis of Short-term (Operating) Activity Ratios
- Analysis of Long-term (Investment) Activity Ratios
- Net Profit Margin since 2019
- Total Asset Turnover since 2019
- Aggregate Accruals
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Free Cash Flow to The Firm (FCFF)
Shockwave Medical Inc., FCFF calculation
US$ in thousands
Based on: 10-K (reporting date: 2023-12-31), 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).
- Operating Activities Cash Flow
- The net cash provided by (used in) operating activities exhibited significant improvement over the five-year period. Initially, there were substantial cash outflows, with negative values of approximately -$48.1 million in 2019 and worsening to -$71.2 million in 2020. However, starting in 2021, the trend reversed, producing positive cash flows of about $15.0 million, further increasing to $117.7 million in 2022 and reaching $196.1 million in 2023. This indicates a notable transition from operational cash usage to strong cash generation from operations.
- Free Cash Flow to the Firm (FCFF)
- Free cash flow to the firm followed a pattern similar to operating cash flows but with generally slightly more negative values in the earlier years. In 2019 and 2020, FCFF was negative at approximately -$51.5 million and -$82.3 million, respectively, indicating heavy cash consumption. Beginning in 2021, FCFF became positive, first posting around $3.1 million, then progressing substantially to $93.2 million in 2022 and further increasing to $166.0 million in 2023. The growth in FCFF suggests enhanced cash generation capacity after accounting for capital expenditures, reflecting improved overall financial health and operational efficiency.
- Overall Observations
- The data reveals a transformational improvement in the company's cash generation capability between 2019 and 2023. The initial years show significant cash outflows from operations and free cash flow deficits, which turned into robust positive cash inflows in the later years. The positive trajectory in both operating cash flow and FCFF from 2021 onwards indicates strengthening operational performance and financial stability, possibly driven by increased revenues, cost management, or reduced capital expenditure needs. This trend positions the company favorably for sustainable growth and value generation going forward.
Interest Paid, Net of Tax
Shockwave Medical Inc., interest paid, net of tax calculation
US$ in thousands
Based on: 10-K (reporting date: 2023-12-31), 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).
2 2023 Calculation
Interest paid, tax = Interest paid × EITR
= × =
- Effective Income Tax Rate (EITR)
- The effective income tax rate remained stable at 21% across the years 2019 through 2022. However, there was a significant increase in 2023, when the rate rose sharply to 73.78%. This sudden jump indicates a substantial change in the company's tax situation during 2023, which could be due to a variety of factors including changes in tax regulations, one-time tax expenses, or adjustments in deferred tax assets or liabilities.
- Interest Paid, Net of Tax
- Net interest paid showed a generally increasing trend from 2019 through 2022. The amount rose steadily from $422 thousand in 2019 to $625 thousand in 2022. However, in 2023, interest paid decreased to $493 thousand, marking a decline from the previous year. Despite this drop, the 2023 value remains higher than the initial years of 2019 and 2020. This pattern suggests that while interest expenses were growing consistently for several years, there was a moderation or reduction in cost or borrowing levels in the most recent year.
Enterprise Value to FCFF Ratio, Current
Shockwave Medical Inc., current EV/FCFF calculation, comparison to benchmarks
| Selected Financial Data (US$ in thousands) | |
| Enterprise value (EV) | |
| Free cash flow to the firm (FCFF) | |
| Valuation Ratio | |
| EV/FCFF | |
| Benchmarks | |
| EV/FCFF, Competitors1 | |
| Abbott Laboratories | |
| Elevance Health Inc. | |
| Intuitive Surgical Inc. | |
| Medtronic PLC | |
| UnitedHealth Group Inc. | |
| EV/FCFF, Sector | |
| Health Care Equipment & Services | |
| EV/FCFF, Industry | |
| Health Care | |
Based on: 10-K (reporting date: 2023-12-31).
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
Shockwave Medical Inc., historical EV/FCFF calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Enterprise value (EV)1 | ||||||
| Free cash flow to the firm (FCFF)2 | ||||||
| Valuation Ratio | ||||||
| EV/FCFF3 | ||||||
| Benchmarks | ||||||
| EV/FCFF, Competitors4 | ||||||
| Abbott Laboratories | ||||||
| Elevance Health Inc. | ||||||
| Intuitive Surgical Inc. | ||||||
| Medtronic PLC | ||||||
| UnitedHealth Group Inc. | ||||||
| EV/FCFF, Sector | ||||||
| Health Care Equipment & Services | ||||||
| EV/FCFF, Industry | ||||||
| Health Care | ||||||
Based on: 10-K (reporting date: 2023-12-31), 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).
3 2023 Calculation
EV/FCFF = EV ÷ FCFF
= ÷ =
4 Click competitor name to see calculations.
- Enterprise Value (EV)
- The enterprise value exhibited a significant upward trend over the five-year period. Starting at approximately $740 million in 2019, it more than quintupled by 2020 to nearly $3.9 billion. This growth continued through 2021 and 2022, reaching about $6.1 billion and $6.6 billion respectively. The most notable increase occurred by the end of 2023, where the value surged to approximately $9.5 billion, indicating strong market valuation expansion and possibly reflecting growth expectations or operational advancements.
- Free Cash Flow to the Firm (FCFF)
- The FCFF initially was negative in 2019 ($-51.5 million) and deteriorated further in 2020, reaching a low of approximately $-82.3 million. However, a reversal in the trend is observed from 2021 onwards, with the company generating positive free cash flow of about $3.1 million, which then increased substantially to around $93.2 million in 2022 and continued to grow to approximately $166.0 million in 2023. This positive trajectory suggests an improving operational efficiency and cash generation capability over these years.
- EV to FCFF Ratio
- This valuation multiple was only calculable from 2021 due to the prior negative FCFF values. The ratio was extraordinarily high at approximately 1986 times in 2021, which decreased sharply to about 71.2 times in 2022, and further declined to roughly 57.0 times in 2023. The reduction in this ratio signals a normalization effect, driven by the significant improvements in free cash flow relative to the market valuation, potentially implying enhanced investor confidence and better fundamentals.