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
AmerisourceBergen Corp., MVA calculation
US$ in thousands
Based on: 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30).
1 Fair value of debt. See details »
2 Invested capital. See details »
The analysis of Market Value Added (MVA) from 2017 to 2022 reveals a substantial increase in shareholder value creation. MVA grew from 10.25 billion USD in 2017 to 27.36 billion USD by 2022, representing a significant expansion in the premium the market assigns to the company over its invested capital.
- Market Value Trajectory
- The fair market value exhibited a consistent upward trend throughout the period. While growth was moderate between 2017 and 2020, an acceleration occurred in 2021 and 2022, with the valuation rising from approximately 26 billion USD in 2020 to over 40 billion USD by September 30, 2022. This suggests a strengthening market perception of the company's future earnings potential and strategic positioning.
- Invested Capital Fluctuations
- Invested capital remained relatively stable between 10.8 billion USD and 12.3 billion USD from 2017 to 2019. A notable contraction occurred on September 30, 2020, where invested capital dropped to 7.13 billion USD. This decrease was temporary, as the figure rebounded to approximately 13 billion USD in 2021 and 2022, indicating a period of capital restructuring or a significant shift in asset management during the 2020 fiscal year.
- Market Value Added (MVA) Performance
- MVA demonstrated a strong positive correlation with the increasing market value, though it was further amplified by the capital dip in 2020. The MVA increased from 10.62 billion USD in 2019 to 18.87 billion USD in 2020, a jump attributed to the simultaneous increase in market value and the reduction in invested capital. By 2022, the MVA reached its peak at 27.36 billion USD, indicating that the market value grew at a rate significantly exceeding the growth of the capital invested in the business.
The overall trend indicates a widening gap between the company's market valuation and its book value of invested capital. This suggests that the company has successfully generated value far in excess of the cost of the capital employed, reflecting high investor confidence and efficient value creation over the six-year period.
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MVA Spread Ratio
AmerisourceBergen Corp., MVA spread ratio calculation, comparison to benchmarks
| Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | Sep 30, 2017 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Market value added (MVA)1 | 27,361,238) | 21,379,475) | 18,869,929) | 10,620,764) | 11,263,878) | 10,251,082) | |
| Invested capital2 | 13,020,519) | 12,902,673) | 7,128,161) | 12,346,959) | 12,285,847) | 10,870,238) | |
| Performance Ratio | |||||||
| MVA spread ratio3 | 210.14% | 165.70% | 264.72% | 86.02% | 91.68% | 94.30% | |
| Benchmarks | |||||||
| MVA Spread Ratio, Competitors4 | |||||||
| Abbott Laboratories | 230.60% | 266.78% | — | — | — | — | |
| Elevance Health Inc. | 108.49% | 116.25% | — | — | — | — | |
| Intuitive Surgical Inc. | 1,400.02% | 2,002.36% | — | — | — | — | |
| Medtronic PLC | 93.80% | 163.10% | — | — | — | — | |
| UnitedHealth Group Inc. | 214.27% | 265.59% | — | — | — | — | |
Based on: 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30).
1 MVA. See details »
2 Invested capital. See details »
3 2022 Calculation
MVA spread ratio = 100 × MVA ÷ Invested capital
= 100 × 27,361,238 ÷ 13,020,519 = 210.14%
4 Click competitor name to see calculations.
A comprehensive analysis of market value added (MVA) and the corresponding spread ratio reveals a significant expansion in shareholder value creation over the six-year period ending September 30, 2022. While the initial years showed relative stability, a sharp inflection point occurred in 2020, leading to a substantial increase in the company's market valuation relative to its invested capital.
- Market Value Added (MVA) Trends
- MVA exhibited a consistent long-term upward trajectory, growing from 10,251,082 thousand US dollars in 2017 to 27,361,238 thousand US dollars by 2022. A slight contraction was noted in 2019, but this was followed by an accelerated growth phase starting in 2020, where MVA increased by approximately 77% in a single year and continued to climb through 2022.
- Invested Capital Fluctuations
- Invested capital remained relatively stable between 2017 and 2019, hovering around 10.8 billion to 12.3 billion US dollars. A significant anomaly occurred on September 30, 2020, where invested capital dropped sharply to 7,128,161 thousand US dollars. This capital base subsequently recovered and stabilized at approximately 13 billion US dollars by 2022.
- MVA Spread Ratio Analysis
- The MVA spread ratio showed a gradual decline from 94.30% in 2017 to 86.02% in 2019, suggesting a period where market value growth lagged slightly behind capital investment. However, the ratio experienced a dramatic spike to 264.72% in 2020, primarily driven by the simultaneous increase in MVA and the sharp decrease in invested capital. Although the ratio moderated to 165.70% in 2021, it rebounded to 210.14% by 2022, indicating a sustained and heightened efficiency in creating market value above the cost of invested capital compared to the 2017-2019 baseline.
The divergence between the steady increase in MVA and the volatility of invested capital suggests that the market began valuing the organization much more aggressively starting in 2020. The result is a permanently higher MVA spread ratio, signaling that the company is generating significantly more market value per unit of invested capital in the latter half of the period than in the beginning.
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MVA Margin
AmerisourceBergen Corp., MVA margin calculation, comparison to benchmarks
| Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | Sep 30, 2017 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Market value added (MVA)1 | 27,361,238) | 21,379,475) | 18,869,929) | 10,620,764) | 11,263,878) | 10,251,082) | |
| Revenue | 238,587,006) | 213,988,843) | 189,893,926) | 179,589,121) | 167,939,635) | 153,143,826) | |
| Performance Ratio | |||||||
| MVA margin2 | 11.47% | 9.99% | 9.94% | 5.91% | 6.71% | 6.69% | |
| Benchmarks | |||||||
| MVA Margin, Competitors3 | |||||||
| Abbott Laboratories | 323.76% | 384.46% | — | — | — | — | |
| Elevance Health Inc. | 46.56% | 54.23% | — | — | — | — | |
| Intuitive Surgical Inc. | 1,209.45% | 1,575.51% | — | — | — | — | |
| Medtronic PLC | 205.92% | 391.27% | — | — | — | — | |
| UnitedHealth Group Inc. | 109.81% | 130.39% | — | — | — | — | |
Based on: 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30).
1 MVA. See details »
2 2022 Calculation
MVA margin = 100 × MVA ÷ Revenue
= 100 × 27,361,238 ÷ 238,587,006 = 11.47%
3 Click competitor name to see calculations.
The financial performance from 2017 to 2022 reflects a period of substantial growth in both absolute market value and operational scale. While revenue maintained a steady upward trajectory, the market value added experienced an accelerated increase, particularly after 2019, indicating a strengthening of the company's market valuation relative to its invested capital.
- Market Value Added (MVA) Progression
- A significant increase in MVA is observed, rising from 10,251,082 thousand US$ in 2017 to 27,361,238 thousand US$ in 2022. Although a slight decline occurred in 2019, where the value dropped to 10,620,764 thousand US$ from 11,263,878 thousand US$ in 2018, the subsequent growth was aggressive. The MVA nearly doubled between 2019 and 2022, suggesting a marked improvement in investor perception and perceived future earning potential.
- Revenue Growth Patterns
- Revenue exhibited consistent year-over-year growth throughout the analyzed period. Starting at 153,143,826 thousand US$ in 2017, the figures climbed steadily to reach 238,587,006 thousand US$ by September 30, 2022. This uninterrupted expansion indicates a sustained increase in the company's operational volume and market reach.
- MVA Margin Interpretation
- The MVA margin remained relatively flat during the first three years, oscillating between 6.69% in 2017 and 5.91% in 2019. A distinct shift occurred in 2020, when the margin surged to 9.94%, followed by a further increase to 11.47% by 2022. This trend demonstrates that the growth in market value significantly outpaced the growth in revenue during the latter part of the period, reflecting enhanced efficiency in value creation and a higher market premium assigned to each dollar of revenue generated.
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