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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- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Short-term (Operating) Activity Ratios
- Common Stock Valuation Ratios
- Dividend Discount Model (DDM)
- Operating Profit Margin since 2005
- Return on Assets (ROA) since 2005
- Current Ratio since 2005
- Debt to Equity since 2005
- Total Asset Turnover since 2005
- Analysis of Debt
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MVA
Western Digital Corp., MVA calculation
US$ in millions
Based on: 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-07-01), 10-K (reporting date: 2021-07-02), 10-K (reporting date: 2020-07-03), 10-K (reporting date: 2019-06-28), 10-K (reporting date: 2018-06-29).
1 Fair value of debt. See details »
2 Invested capital. See details »
- Market Value
- The market (fair) value of the entity exhibited a declining trend from June 29, 2018, to July 3, 2020, decreasing from $29,998 million to $21,317 million. A recovery followed in the fiscal year ending July 2, 2021, where the value rose to $28,931 million. However, this was not sustained, with the market value declining again in the subsequent years to $22,051 million in 2022 and further to $20,863 million in 2023.
- Invested Capital
- Invested capital showed a consistent downward trend over the entire period under review. Starting at $22,667 million in June 2018, it steadily decreased to $18,928 million by June 2023. This represents a gradual reduction in invested resources, with the decrease being relatively moderate but persistent year over year.
- Market Value Added (MVA)
- The market value added fluctuated noticeably throughout the given timeline. The initial figure of $7,331 million in June 2018 declined significantly to a low of $1,633 million in July 2020. A sharp increase was recorded in 2021, where MVA rose to $9,352 million, marking the highest point in the series. Subsequently, it fell sharply again to $2,283 million in 2022 and slightly decreased to $1,935 million in 2023. These variations indicate volatility in the value created above invested capital, with a strong recovery that was not maintained.
- Overall Insights
- Overall, the data presents a picture of declining invested capital and fluctuating market valuations with notable volatility in market value added. The peak in market value and MVA in 2021 contrasts with general downward trends before and after that year, suggesting a period of improved market perception or operational performance that was not sustained. The consistent decrease in invested capital may reflect strategic divestments, asset reductions, or changes in investment strategy over the years.
MVA Spread Ratio
Western Digital Corp., MVA spread ratio calculation, comparison to benchmarks
| Jun 30, 2023 | Jul 1, 2022 | Jul 2, 2021 | Jul 3, 2020 | Jun 28, 2019 | Jun 29, 2018 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Market value added (MVA)1 | |||||||
| Invested capital2 | |||||||
| Performance Ratio | |||||||
| MVA spread ratio3 | |||||||
| Benchmarks | |||||||
| MVA Spread Ratio, Competitors4 | |||||||
| Apple Inc. | |||||||
| Arista Networks Inc. | |||||||
| Cisco Systems Inc. | |||||||
| Dell Technologies Inc. | |||||||
| Super Micro Computer Inc. | |||||||
Based on: 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-07-01), 10-K (reporting date: 2021-07-02), 10-K (reporting date: 2020-07-03), 10-K (reporting date: 2019-06-28), 10-K (reporting date: 2018-06-29).
1 MVA. See details »
2 Invested capital. See details »
3 2023 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 fluctuating trend over the periods. It started relatively high at 7,331 million US dollars in mid-2018 but then decreased significantly to 1,633 million by mid-2020. This was followed by a sharp increase to 9,352 million in mid-2021, suggesting a period of substantial market value growth. Subsequently, MVA decreased in the following two years, reaching 1,935 million by mid-2023. This pattern indicates considerable volatility in the market value added during the timeframe.
- Invested capital
- The invested capital shows a general downward trend across the period analyzed. Beginning at 22,667 million US dollars in 2018, it steadily declined over the years, with small fluctuations, to 18,928 million by mid-2023. This reduction suggests a gradual divestment or efficient utilization of capital, reflecting a more conservative investment approach or capital realignment within the company.
- MVA spread ratio
- The MVA spread ratio follows a pattern broadly aligned with the MVA movements. Initially, this ratio was relatively high at 32.34% in 2018 but declined sharply to 8.29% in 2020. This was followed by a pronounced increase to 47.77% in 2021, indicating a strong positive spread between return and cost of capital during that year. Afterward, the ratio decreased significantly to 10.22% by 2023, denoting a reduction in market value added relative to invested capital. This volatility in the spread ratio emphasizes fluctuating profitability or efficiency in value creation across the years.
MVA Margin
Western Digital Corp., MVA margin calculation, comparison to benchmarks
| Jun 30, 2023 | Jul 1, 2022 | Jul 2, 2021 | Jul 3, 2020 | Jun 28, 2019 | Jun 29, 2018 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Market value added (MVA)1 | |||||||
| Revenue, net | |||||||
| Performance Ratio | |||||||
| MVA margin2 | |||||||
| Benchmarks | |||||||
| MVA Margin, Competitors3 | |||||||
| Apple Inc. | |||||||
| Arista Networks Inc. | |||||||
| Cisco Systems Inc. | |||||||
| Dell Technologies Inc. | |||||||
| Super Micro Computer Inc. | |||||||
Based on: 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-07-01), 10-K (reporting date: 2021-07-02), 10-K (reporting date: 2020-07-03), 10-K (reporting date: 2019-06-28), 10-K (reporting date: 2018-06-29).
1 MVA. See details »
2 2023 Calculation
MVA margin = 100 × MVA ÷ Revenue, net
= 100 × ÷ =
3 Click competitor name to see calculations.
- Market Value Added (MVA)
- The market value added demonstrates considerable volatility over the analyzed periods. Starting at 7,331 million US dollars in 2018, it declined significantly in the next two years, reaching a low of 1,633 million US dollars in 2020. Subsequently, there was a substantial recovery in 2021 to 9,352 million US dollars. However, the MVA decreased again in the last two years, ending at 1,935 million US dollars in 2023. This fluctuation points to varying market perceptions and possibly underlying changes in company valuation or investor confidence.
- Revenue, Net
- Net revenue exhibited a declining trend from 2018 to 2019, moving from 20,647 million to 16,569 million US dollars. Following a slight rebound to 16,736 million in 2020 and 16,922 million in 2021, revenue rose again to 18,793 million in 2022. However, 2023 saw a sharp decline to 12,318 million US dollars, suggesting recent challenges impacting sales or market demand. Overall, the revenue trend is characterized by modest recovery attempts after an initial drop, followed by a significant decrease in the most recent year.
- MVA Margin
- The MVA margin aligns with the fluctuations seen in the MVA. From a high of 35.51% in 2018, it declined to 31.23% in 2019 and plummeted to 9.75% in 2020. A notable increase occurred in 2021, reaching 55.27%, the peak for the period covered. However, like the MVA, this margin fell sharply thereafter, dropping to 12.15% in 2022 and slightly improving to 15.71% in 2023. The variability in this ratio indicates inconsistent value creation relative to revenue over the years.
- Overall Insights
- The financial data reveals significant instability in both market value added and revenue across the six-year timeframe. After experiencing initial declines in both performance and market valuation, there was a brief period of recovery, especially evident in 2021. Nevertheless, the sustained downward movement in the latest years, particularly 2023, suggests emerging challenges that may impact profitability and shareholder value. The fluctuating MVA margin reinforces the notion of inconsistent profitability or market performance relative to revenue during the periods analyzed.