Price to FCFE (P/FCFE)
Free Cash Flow to Equity (FCFE)
Allergan PLC, FCFE calculation
US$ in thousands
Based on: 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
The financial data reveals significant volatility in both operating cash flows and free cash flow to equity (FCFE) between 2015 and 2019, characterized by sharp fluctuations that suggest aggressive capital restructuring or strategic investment cycles.
- Net Cash Provided by Operating Activities
- Operating cash flows exhibited a non-linear trend. Following a substantial decline in 2016, where cash provided dropped to 1.43 billion US$, a strong recovery was observed in 2017, reaching 5.87 billion US$. This positive momentum continued through 2019, culminating in a peak of 7.24 billion US$, indicating an improving capacity to generate cash from core business operations over the latter half of the period.
- Free Cash Flow to Equity (FCFE)
- FCFE demonstrated extreme instability, fluctuating between high positive surpluses and significant deficits. A notable peak occurred in 2015 with 28.75 billion US$, which was followed by a sharp reversal to a deficit of 8.67 billion US$ in 2016. While the figures remained volatile in 2017 and 2018, the period ended with a positive trajectory in 2019, reaching 5.80 billion US$.
- Cash Flow Divergence and Correlation
- A significant divergence between operating cash flows and FCFE is evident, particularly in 2015. In that year, FCFE substantially exceeded operating cash flows, suggesting an influx of cash from financing activities, such as new debt issuance or asset divestitures. Conversely, the negative FCFE observed in 2016 and 2018, despite positive operating cash flows, indicates periods of intensive capital expenditure or substantial debt repayments that exceeded the cash generated from operations.
Overall, the trend from 2017 to 2019 suggests a transition toward a more stable and sustainable cash flow profile, as the gap between operating cash flow and FCFE narrowed and both metrics trended upward.
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Price to FCFE Ratio, Current
Allergan PLC, current P/FCFE calculation, comparison to benchmarks
| No. shares of common stock outstanding | 329,805,791 |
| Selected Financial Data (US$) | |
| Free cash flow to equity (FCFE) (in thousands) | 5,795,900) |
| FCFE per share | 17.57 |
| Current share price (P) | 192.99 |
| Valuation Ratio | |
| P/FCFE | 10.98 |
| Benchmarks | |
| P/FCFE, Competitors1 | |
| AbbVie Inc. | 29.64 |
| Amgen Inc. | 104.06 |
| Bristol-Myers Squibb Co. | 16.56 |
| Danaher Corp. | 26.10 |
| Eli Lilly & Co. | 78.03 |
| Gilead Sciences Inc. | 27.39 |
| Johnson & Johnson | 23.15 |
| Merck & Co. Inc. | 15.46 |
| Pfizer Inc. | 18.51 |
| Regeneron Pharmaceuticals Inc. | 25.28 |
| Thermo Fisher Scientific Inc. | 22.88 |
| Vertex Pharmaceuticals Inc. | 43.80 |
Based on: 10-K (reporting date: 2019-12-31).
1 Click competitor name to see calculations.
If the company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.
Otherwise, if the company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.
Price to FCFE Ratio, Historical
Allergan PLC, historical P/FCFE calculation, comparison to benchmarks
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 329,002,015 | 332,614,474 | 330,320,420 | 335,224,713 | 394,687,384 | |
| Selected Financial Data (US$) | ||||||
| Free cash flow to equity (FCFE) (in thousands)2 | 5,795,900) | (740,900) | 2,032,100) | (8,673,500) | 28,753,200) | |
| FCFE per share3 | 17.62 | -2.23 | 6.15 | -25.87 | 72.85 | |
| Share price1, 4 | 198.00 | 139.07 | 164.04 | 245.37 | 298.07 | |
| Valuation Ratio | ||||||
| P/FCFE5 | 11.24 | — | 26.66 | — | 4.09 | |
| Benchmarks | ||||||
| P/FCFE, Competitors6 | ||||||
| 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. | — | — | — | — | — | |
| Vertex Pharmaceuticals Inc. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
1 Data adjusted for splits and stock dividends.
3 2019 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= 5,795,900,000 ÷ 329,002,015 = 17.62
4 Closing price as at the filing date of Allergan PLC Annual Report.
5 2019 Calculation
P/FCFE = Share price ÷ FCFE per share
= 198.00 ÷ 17.62 = 11.24
6 Click competitor name to see calculations.
The financial data indicates a period of significant volatility regarding equity valuation and cash flow generation between 2015 and 2019. A pronounced downward trend in share price is observed from 2015 through 2018, followed by a partial recovery in 2019. This price movement coincided with erratic fluctuations in Free Cash Flow to Equity (FCFE) per share, which shifted between positive and negative values throughout the analyzed period.
- Share Price Trend
- The share price experienced a consistent decline from a peak of 298.07 US$ in 2015 to a trough of 139.07 US$ in 2018. A recovery phase began in 2019, with the price increasing to 198.00 US$.
- FCFE per Share Performance
- Cash flows available to equity holders exhibited extreme instability. After a strong result of 72.85 US$ in 2015, FCFE per share turned sharply negative in 2016 (-25.87 US$). A marginal recovery occurred in 2017 (6.15 US$), followed by another dip into negative territory in 2018 (-2.23 US$), before returning to a positive 17.62 US$ in 2019.
- P/FCFE Ratio Analysis
- The P/FCFE ratio remained undefined in 2016 and 2018 due to negative FCFE values. In 2015, the ratio was notably low at 4.09, indicating high cash flow relative to the share price. By 2017, the ratio spiked to 26.66, reflecting a significant contraction in FCFE per share. The ratio normalized to 11.24 in 2019, aligned with the recovery of both the share price and free cash flow.
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