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.
MVA
Trade Desk Inc., MVA calculation
US$ in thousands
Based on: 10-K (reporting date: 2024-12-31), 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).
2 Invested capital. See details »
- Market (fair) value of Trade Desk
- The market value exhibits a declining trend from 42,908,499 thousand US dollars at the end of 2020 to 32,384,572 thousand US dollars at the end of 2022. This downward trajectory reverses somewhat in 2023, increasing to 36,768,141 thousand US dollars, before slightly decreasing again in 2024 to 35,508,330 thousand US dollars. Overall, the market value shows volatility with a general decrease over the five-year period.
- Invested Capital
- Invested capital steadily rises from 1,062,113 thousand US dollars in 2020 to 1,865,761 thousand US dollars in 2022, indicating increased capital deployment. It slightly declines in 2023 to 1,764,443 thousand US dollars but surges considerably in 2024 to 2,455,827 thousand US dollars. This suggests a strategic increase in capital investment in the later years after moderate fluctuations.
- Market Value Added (MVA)
- The market value added (MVA) follows a trend similar to that of the market value. It decreases steadily from 41,846,386 thousand US dollars in 2020 to 30,518,811 thousand US dollars in 2022. A recovery is seen in 2023 when MVA increases to 35,003,698 thousand US dollars, followed by a slight decline to 33,052,503 thousand US dollars in 2024. This pattern reflects the combined impact of market value changes and invested capital adjustments over time.
MVA Spread Ratio
Trade Desk Inc., MVA spread ratio calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Market value added (MVA)1 | 33,052,503) | 35,003,698) | 30,518,811) | 37,768,178) | 41,846,386) | |
| Invested capital2 | 2,455,827) | 1,764,443) | 1,865,761) | 1,539,599) | 1,062,113) | |
| Performance Ratio | ||||||
| MVA spread ratio3 | 1,345.88% | 1,983.84% | 1,635.73% | 2,453.12% | 3,939.92% | |
| Benchmarks | ||||||
| MVA Spread Ratio, Competitors4 | ||||||
| Alphabet Inc. | 914.11% | 797.59% | 533.88% | 988.84% | 800.47% | |
| Charter Communications Inc. | 1.55% | 3.78% | 12.56% | 58.27% | 65.04% | |
| Comcast Corp. | 4.16% | 34.32% | 23.22% | 50.36% | 64.16% | |
| Meta Platforms Inc. | 957.71% | 767.10% | 380.86% | 579.06% | 791.20% | |
| Netflix Inc. | 961.87% | 596.82% | 371.76% | 453.21% | 772.09% | |
| Walt Disney Co. | 50.39% | 33.59% | 34.30% | 103.57% | 101.22% | |
Based on: 10-K (reporting date: 2024-12-31), 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).
1 MVA. See details »
2 Invested capital. See details »
3 2024 Calculation
MVA spread ratio = 100 × MVA ÷ Invested capital
= 100 × 33,052,503 ÷ 2,455,827 = 1,345.88%
4 Click competitor name to see calculations.
The financial data reveals several notable trends in the company's market value added (MVA), invested capital, and MVA spread ratio over the observed periods.
- Market Value Added (MVA)
- The MVA shows a declining trend from 41,846,386 thousand US dollars in 2020 down to 33,052,503 thousand US dollars in 2024. The most significant drop occurred between 2020 and 2022, where the MVA decreased by nearly 27%. Although there was a slight recovery in 2023, the MVA declined again in 2024, indicating fluctuating market valuation with an overall downward trajectory over the five-year span.
- Invested Capital
- Invested capital demonstrates a rising pattern from 1,062,113 thousand US dollars in 2020 to 2,455,827 thousand US dollars in 2024. This represents more than a doubling of invested capital over the period, with a notable increase between 2023 and 2024. The trend suggests ongoing capital investment efforts, possibly to support growth or operational expansion.
- MVA Spread Ratio
- The MVA spread ratio, expressed as a percentage, has exhibited a consistent decline from an exceptionally high 3,939.92% in 2020 to 1,345.88% in 2024. After a sharp decrease from 2020 through 2022, there was a moderate rebound in 2023 followed by another decline in 2024. This pattern indicates a reduction in the return generated over invested capital relative to market value creation, implying diminishing efficiency or increased capital intensity.
In summary, despite increasing invested capital, the market value added and MVA spread ratio have decreased significantly. This may suggest that the additional capital invested has not proportionally translated into increased market value generation or improved profitability margins over the observed periods. The fluctuating yet downward trends in MVA and MVA spread ratio highlight the importance of closely monitoring capital allocation effectiveness and market valuation drivers going forward.
MVA Margin
Trade Desk Inc., MVA margin calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Market value added (MVA)1 | 33,052,503) | 35,003,698) | 30,518,811) | 37,768,178) | 41,846,386) | |
| Revenue | 2,444,831) | 1,946,120) | 1,577,795) | 1,196,467) | 836,033) | |
| Performance Ratio | ||||||
| MVA margin2 | 1,351.93% | 1,798.64% | 1,934.27% | 3,156.64% | 5,005.35% | |
| Benchmarks | ||||||
| MVA Margin, Competitors3 | ||||||
| Alphabet Inc. | 593.71% | 491.55% | 381.04% | 655.85% | 636.95% | |
| Charter Communications Inc. | 3.84% | 9.28% | 30.51% | 147.55% | 180.14% | |
| Comcast Corp. | 7.21% | 59.40% | 41.05% | 99.16% | 138.43% | |
| Meta Platforms Inc. | 965.69% | 802.73% | 332.57% | 454.84% | 744.17% | |
| Netflix Inc. | 1,002.08% | 667.68% | 443.50% | 529.22% | 912.25% | |
| Walt Disney Co. | 91.70% | 65.59% | 70.59% | 263.91% | 272.21% | |
Based on: 10-K (reporting date: 2024-12-31), 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).
1 MVA. See details »
2 2024 Calculation
MVA margin = 100 × MVA ÷ Revenue
= 100 × 33,052,503 ÷ 2,444,831 = 1,351.93%
3 Click competitor name to see calculations.
The financial data reveals several significant trends in the company's performance over the five-year period ending December 31, 2024.
- Market Value Added (MVA)
- The MVA demonstrates a declining trend overall. It starts at a peak of approximately 41.8 billion US dollars in 2020 and decreases to around 33.1 billion US dollars by 2024. Notably, there is a fluctuation with a low point in 2022 at about 30.5 billion US dollars, followed by a partial recovery in 2023 before a slight dip again in 2024. This trend suggests that while the company continues to add market value, the rate of creation is diminishing over the period.
- Revenue
- In contrast to the MVA, revenue shows a consistent and strong upward trajectory. From 836 million US dollars in 2020, revenues increased annually, reaching approximately 2.44 billion US dollars in 2024. This steady growth indicates expanding business operations and increasing sales over the observed years.
- MVA Margin
- The MVA margin, expressed as a percentage, exhibits a pronounced downward trend, decreasing from around 5005% in 2020 to about 1352% in 2024. This ratio reflects the relationship between market value added and revenue. The continuous decline suggests that despite rising revenues, the market value added per unit of revenue is diminishing, indicating potentially decreasing efficiency or a market reassessment of the company's value relative to its sales.
Overall, the data suggests that while revenue growth has been robust and consistent, the company's ability to generate market value relative to its revenue has weakened steadily. The declining MVA and MVA margin may warrant further investigation into market expectations, operational efficiency, or other external factors influencing investor perception and valuation dynamics.