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.
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- Income Statement
- Statement of Comprehensive Income
- Cash Flow Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Long-term (Investment) Activity Ratios
- Price to FCFE (P/FCFE)
- Capital Asset Pricing Model (CAPM)
- Present Value of Free Cash Flow to Equity (FCFE)
- Return on Equity (ROE) since 2005
- Price to Operating Profit (P/OP) since 2005
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MVA
Vertex Pharmaceuticals 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).
1 Fair value of debt. See details »
2 Invested capital. See details »
- Market (fair) value of Vertex
- The market value of the company shows a consistent upward trend over the five-year period. Starting at approximately $54.99 billion at the end of 2020, it progressively increases each year, reaching about $113.88 billion by the end of 2024. This represents more than a doubling in market value, with particularly notable growth between 2022 and 2023.
- Invested capital
- The invested capital exhibits fluctuations rather than a clear upward or downward trajectory. It begins at about $8.14 billion in 2020 and increases steadily through 2022 and 2023, reaching approximately $13.28 billion in 2022 and slightly adjusting to $13.24 billion in 2023. However, there is a significant decline in 2024, dropping to approximately $9.05 billion. This decline contrasts with the ongoing rise in market value.
- Market value added (MVA)
- Market value added, which measures the excess of market value over invested capital, demonstrates a strong growth pattern throughout the period. It starts at around $46.85 billion in 2020 and steadily rises each subsequent year, reaching about $104.84 billion by 2024. The increasing MVA indicates that the company's market value continues to grow disproportionately more than the invested capital, highlighting enhanced value creation for shareholders.
- Summary of trends
- Overall, the company exhibits substantial growth in market valuation over the five-year span. While invested capital initially rises, it declines sharply in the final year, suggesting possible divestment, improved capital efficiency, or changes in capital structure. Despite this, market value and MVA continue to increase, which may imply investor confidence, strong earnings potential, or other strategic factors enhancing company valuation. The divergence between invested capital and market value toward the end of the observed period is a significant point for further investigation.
MVA Spread Ratio
Vertex Pharmaceuticals Inc., MVA spread ratio calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Market value added (MVA)1 | ||||||
| Invested capital2 | ||||||
| Performance Ratio | ||||||
| MVA spread ratio3 | ||||||
| Benchmarks | ||||||
| MVA Spread Ratio, Competitors4 | ||||||
| AbbVie Inc. | ||||||
| Amgen Inc. | ||||||
| Bristol-Myers Squibb Co. | ||||||
| Danaher Corp. | ||||||
| Eli Lilly & Co. | ||||||
| Gilead Sciences Inc. | ||||||
| Johnson & Johnson | ||||||
| Merck & Co. Inc. | ||||||
| Pfizer Inc. | ||||||
| Regeneron Pharmaceuticals Inc. | ||||||
| Thermo Fisher Scientific Inc. | ||||||
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 × ÷ =
4 Click competitor name to see calculations.
- Market Value Added (MVA)
- The market value added shows a consistent increasing trend over the observed periods. From 2020 to 2024, the MVA rose significantly from approximately 46.8 billion US dollars to over 104.8 billion US dollars, indicating substantial growth in market valuation relative to invested capital.
- Invested Capital
- Invested capital exhibited an initial increasing trend from 8.14 billion US dollars in 2020 to a peak of around 13.28 billion US dollars in 2022. However, this was followed by a decline to approximately 9.05 billion US dollars in 2024, which might reflect divestitures, asset sales, or shifts in capital allocation strategies.
- MVA Spread Ratio
- The MVA spread ratio, which reflects the ratio of market value added relative to invested capital, demonstrates a fluctuating pattern with significant changes. It declined from 575.24% in 2020 to 484.09% in 2022, indicating a reduction in value creation efficiency during that period. However, this ratio increased markedly to 712.26% in 2023 and further surged to 1158.91% in 2024, suggesting an enhanced ability to generate value for shareholders from the invested capital in recent years.
- Overall Observations
- The data indicates that despite fluctuations in invested capital, the company has achieved substantial growth in market value added, especially in the latest years. The pronounced increase in the MVA spread ratio toward the end of the period suggests improved market perceptions or operational performance leading to higher value creation. The decline in invested capital concurrent with rising MVA in the final year could reflect efficiency improvements or strategic realignments that have positively impacted shareholder value.
MVA Margin
Vertex Pharmaceuticals 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 | ||||||
| Revenues | ||||||
| Performance Ratio | ||||||
| MVA margin2 | ||||||
| Benchmarks | ||||||
| MVA Margin, Competitors3 | ||||||
| AbbVie Inc. | ||||||
| Amgen Inc. | ||||||
| Bristol-Myers Squibb Co. | ||||||
| Danaher Corp. | ||||||
| Eli Lilly & Co. | ||||||
| Gilead Sciences Inc. | ||||||
| Johnson & Johnson | ||||||
| Merck & Co. Inc. | ||||||
| Pfizer Inc. | ||||||
| Regeneron Pharmaceuticals Inc. | ||||||
| Thermo Fisher Scientific Inc. | ||||||
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 ÷ Revenues
= 100 × ÷ =
3 Click competitor name to see calculations.
- Market Value Added (MVA)
- The Market Value Added exhibited a consistent and substantial upward trend over the five-year period. Starting at approximately $46.85 billion in 2020, it increased steadily each year, reaching roughly $104.84 billion by the end of 2024. This more than doubling of the MVA indicates a significant increase in the company's market valuation above the capital invested by shareholders, reflecting growing investor confidence and value creation.
- Revenues
- Revenues demonstrated a steady annual increase from 2020 to 2024. The figures rose from about $6.21 billion in 2020 to approximately $11.02 billion in 2024. This consistent growth reflects positive business expansion and effective operational performance, with revenues nearly doubling within the given timeframe.
- MVA Margin
- The MVA margin, representing the ratio of Market Value Added to Revenues expressed as a percentage, showed slight fluctuations but maintained a generally high level. It started at 754.94% in 2020 and declined somewhat in 2021 and 2022 to around 700-714%, suggesting a temporary compression in value creation relative to revenues. However, there was a notable increase in 2023 to 955.82%, maintaining a similar level of 951.31% in 2024. This rebound indicates an enhanced market valuation relative to revenue in the most recent years, potentially due to improved profitability, market perception, or growth prospects.