Economic Value Added (EVA)
EVA is registered trademark of Stern Stewart.
Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.
Paying user area
Try for free
Amphenol Corp. pages available for free this week:
- Common-Size Balance Sheet: Assets
- Analysis of Profitability Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Dividend Discount Model (DDM)
- Present Value of Free Cash Flow to Equity (FCFE)
- Selected Financial Data since 2005
- Current Ratio since 2005
- Price to Book Value (P/BV) since 2005
- Analysis of Revenues
- Aggregate Accruals
The data is hidden behind: . Unhide it.
Get full access to the entire website from $10.42/mo, or
get 1-month access to Amphenol Corp. for $22.49.
This is a one-time payment. There is no automatic renewal.
We accept:
Economic Profit
Amphenol Corp., economic profit calculation
US$ in thousands
| 12 months ended: | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|---|
| Net operating profit after taxes (NOPAT)1 | ||||||
| Cost of capital2 | ||||||
| Invested capital3 | ||||||
| Economic profit4 | ||||||
Based on: 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), 10-K (reporting date: 2019-12-31).
1 NOPAT. See details »
2 Cost of capital. See details »
3 Invested capital. See details »
4 2023 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= – × =
- Net Operating Profit After Taxes (NOPAT)
- The NOPAT shows a general upward trend from 2019 to 2022, increasing steadily from approximately 1,277,245 thousand USD in 2019 to a peak of 2,040,201 thousand USD in 2022. However, in 2023, there is a slight decline to 2,010,042 thousand USD, indicating a marginal decrease after four consecutive years of growth.
- Cost of Capital
- The cost of capital has gradually increased each year, starting at 15.89% in 2019 and reaching 16.64% in 2023. This steady rise suggests a growing expense associated with financing and capital investment over the analyzed period.
- Invested Capital
- Invested capital shows a consistent increase throughout the five years, moving from 9,029,400 thousand USD in 2019 to 13,752,400 thousand USD in 2023. This upward trend reflects ongoing investments or asset accumulation by the company over the period.
- Economic Profit
- Economic profit remains negative in all observed years, signaling that the company’s returns have not exceeded its cost of capital. The losses deepened from -157,800 thousand USD in 2019 to -292,344 thousand USD in 2021. There is a notable improvement in 2022 with the economic loss reducing to -48,418 thousand USD, yet in 2023, economic profit deteriorates again to -278,320 thousand USD. This volatility indicates challenges in generating returns above the capital cost despite growth in operating profit and invested capital.
- Summary
- Overall, the company has experienced growth in net operating profit and invested capital, but the rising cost of capital and persistent negative economic profit highlight underlying efficiency or profitability issues relative to capital costs. The transient improvement in economic profit in 2022 suggests brief operational gains, but the subsequent decline in 2023 warrants further investigation into factors driving these fluctuations.
Net Operating Profit after Taxes (NOPAT)
Amphenol Corp., NOPAT calculation
US$ in thousands
Based on: 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), 10-K (reporting date: 2019-12-31).
1 Elimination of deferred tax expense. See details »
2 Addition of increase (decrease) in allowance for doubtful accounts.
3 Addition of increase (decrease) in equity equivalents to net income attributable to Amphenol Corporation.
4 2023 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= × =
5 2023 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= × 21.00% =
6 Addition of after taxes interest expense to net income attributable to Amphenol Corporation.
7 Elimination of discontinued operations.
The financial data reveals a generally positive trend in profitability over the five-year period from 2019 to 2023, with some fluctuations in specific measures.
- Net Income Attributable to Amphenol Corporation
- This metric shows a consistent increase from 2019 to 2023, starting at 1,155,000 thousand US dollars in 2019 and rising to 1,928,000 thousand US dollars in 2023. The most significant jump occurred between 2020 and 2021, where net income increased by approximately 32.2%, from 1,203,400 to 1,590,800 thousand US dollars. Growth continued through 2022, reaching 1,902,300 thousand US dollars, before showing a more modest increase of about 1.3% into 2023.
- Net Operating Profit After Taxes (NOPAT)
- NOPAT followed a similar upward trend, rising from 1,277,245 thousand US dollars in 2019 to a peak of 2,040,201 thousand US dollars in 2022. This represents an overall increase of nearly 60%. There is a steady year-over-year improvement, with the largest increase again visible from 2021 to 2022. However, in 2023, there is a slight decline of approximately 1.5%, decreasing to 2,010,042 thousand US dollars. Despite this small reduction, the 2023 figure remains significantly higher than in the early years.
Overall, the data indicates strong growth in profitability, with both net income and NOPAT more than doubling during the examined timeframe. The minor dip in NOPAT in 2023 suggests a potential plateau or emerging challenges affecting operating profit, though net income continues to rise slightly. This pattern suggests effective operational performance and profitability growth over the longer term, with a need to monitor recent subtle downturns in operating profit closely.
Cash Operating Taxes
Amphenol Corp., cash operating taxes calculation
US$ in thousands
Based on: 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), 10-K (reporting date: 2019-12-31).
The provision for income taxes and cash operating taxes for the analyzed periods reveal notable trends in tax-related expenses.
- Provision for income taxes
- There was a decrease from 331,900 thousand USD in 2019 to 313,300 thousand USD in 2020, indicating a reduction in estimated tax liabilities. In 2021, this figure sharply increased to 409,100 thousand USD, followed by a further rise to 550,600 thousand USD in 2022. However, in 2023, a slight decline to 509,300 thousand USD was observed, suggesting some relief in tax provisions compared to the previous year but still significantly higher than pre-pandemic levels.
- Cash operating taxes
- Cash operating taxes also decreased from 342,736 thousand USD in 2019 to 307,985 thousand USD in 2020, mirroring the provision trend and likely reflecting the impact of external economic factors. Beginning in 2021, cash taxes increased substantially to 464,115 thousand USD and continued to increase through 2022 and 2023, reaching 583,929 thousand USD and 599,691 thousand USD respectively. This steady increase indicates an upward pressure on actual tax payments despite the slight reduction in provisions in 2023.
Overall, the data shows a downward shift in both tax provisions and cash taxes during 2020, possibly due to extraordinary circumstances affecting taxable income. However, from 2021 onwards, both measures display a pronounced upward trend, highlighting a recovery or growth phase characterized by higher taxable earnings and increased cash tax outflows. The divergence in 2023, where cash taxes slightly rise while provisions fall, may suggest adjustments in expected future tax liabilities or timing differences in tax payments.
Invested Capital
Amphenol Corp., invested capital calculation (financing approach)
US$ in thousands
Based on: 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), 10-K (reporting date: 2019-12-31).
1 Addition of capitalized operating leases.
2 Elimination of deferred taxes from assets and liabilities. See details »
3 Addition of allowance for doubtful accounts receivable.
4 Addition of equity equivalents to stockholders’ equity attributable to Amphenol Corporation.
5 Removal of accumulated other comprehensive income.
6 Subtraction of investments.
- Total reported debt & leases
- The total reported debt and leases exhibited an overall upward trend from 2019 through 2021, increasing from approximately $3.81 billion to $5.05 billion. This was followed by a decline in the subsequent two years, lowering the figure to about $4.64 billion by 2023. The initial rise may indicate increased leverage or financing activities, while the subsequent decrease suggests debt reduction or repayment strategies.
- Stockholders’ equity attributable to Amphenol Corporation
- Stockholders' equity showed consistent growth throughout the examined period, rising from roughly $4.53 billion in 2019 to $8.35 billion in 2023. This steady increase points to strengthening financial stability, possibly driven by retained earnings, profitable operations, or issuance of equity, thereby enhancing the company's net worth.
- Invested capital
- Invested capital demonstrated a continuous increase over the five years, expanding from approximately $9.03 billion to $13.75 billion. The upward trend reflects ongoing investments in assets, acquisitions, or capital expenditures supporting the company’s growth and operational capacity. The growth rate in invested capital generally outpaced that of debt, indicating a rising equity contribution.
Cost of Capital
Amphenol Corp., cost of capital calculations
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2023-12-31).
1 US$ in thousands
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2022-12-31).
1 US$ in thousands
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2021-12-31).
1 US$ in thousands
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2020-12-31).
1 US$ in thousands
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2019-12-31).
1 US$ in thousands
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
Economic Spread Ratio
Amphenol Corp., economic spread ratio calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Economic profit1 | ||||||
| Invested capital2 | ||||||
| Performance Ratio | ||||||
| Economic spread ratio3 | ||||||
| Benchmarks | ||||||
| Economic Spread Ratio, Competitors4 | ||||||
| Apple Inc. | ||||||
| Arista Networks Inc. | ||||||
| Cisco Systems Inc. | ||||||
| Dell Technologies Inc. | ||||||
| Super Micro Computer Inc. | ||||||
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 Economic profit. See details »
2 Invested capital. See details »
3 2023 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × ÷ =
4 Click competitor name to see calculations.
- Economic Profit
- The economic profit values demonstrate a consistently negative trend across the five-year period. Starting at -157,800 thousand US dollars in 2019, the economic loss deepened substantially by 2021, reaching -292,344 thousand. There is a notable improvement in 2022 to -48,418 thousand US dollars, representing a significant reduction in losses compared to the previous years. However, in 2023 economic profit deteriorated again to a loss of -278,320 thousand US dollars, signaling renewed downward pressure on profitability.
- Invested Capital
- Invested capital shows a steady upward trajectory throughout the period. Beginning at 9,029,400 thousand US dollars in 2019, the amount invested in capital assets steadily increased each year, reaching 13,752,400 thousand US dollars by 2023. This continuous growth in invested capital indicates ongoing investment and expansion efforts despite the periods of economic losses.
- Economic Spread Ratio
- The economic spread ratio, which measures the spread between the return on invested capital and the cost of capital, remained negative throughout all years. It started at -1.75% in 2019 and worsened to -2.6% in 2020, implying returns below the cost of capital. The ratio slightly improved to -2.43% in 2021, followed by a notable recovery in 2022 to -0.38%, the lowest loss during the period. However, the ratio declined again to -2.02% in 2023, reflecting renewed pressure on creating value above the cost of capital.
- Overall Insights
- Despite steady increases in invested capital, economic profit remained negative in each year, indicating challenges in generating returns that exceed the cost of capital. The temporary improvements in both economic profit and the economic spread ratio in 2022 suggest some operational or strategic improvement during that year, but these gains were not sustained into 2023. The data imply the company is investing consistently but continues to face difficulties in converting these investments into positive economic profit, raising questions about efficiency and cost management strategies.
Economic Profit Margin
Amphenol Corp., economic profit margin calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Economic profit1 | ||||||
| Net sales | ||||||
| Performance Ratio | ||||||
| Economic profit margin2 | ||||||
| Benchmarks | ||||||
| Economic Profit Margin, Competitors3 | ||||||
| Apple Inc. | ||||||
| Arista Networks Inc. | ||||||
| Cisco Systems Inc. | ||||||
| Dell Technologies Inc. | ||||||
| Super Micro Computer Inc. | ||||||
Based on: 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), 10-K (reporting date: 2019-12-31).
1 Economic profit. See details »
2 2023 Calculation
Economic profit margin = 100 × Economic profit ÷ Net sales
= 100 × ÷ =
3 Click competitor name to see calculations.
- Net Sales
- There is a consistent upward trend in net sales from 2019 to 2022, with values rising from approximately $8.23 billion in 2019 to around $12.62 billion in 2022, marking a substantial increase. However, a slight decrease is observed in 2023, where net sales mildly declined to about $12.55 billion.
- Economic Profit
- The economic profit figures remain negative throughout the period, indicating economic losses each year. The losses deepen from 2019 to 2021, reaching a peak negative value of approximately -$292 million in 2021. A notable improvement occurs in 2022, with losses significantly reduced to around -$48 million. Nonetheless, this improvement is not sustained, as economic profit deteriorates again in 2023, nearing -$278 million.
- Economic Profit Margin
- Mirroring the economic profit trend, the economic profit margin remains negative during these years, signaling that economic losses persist relative to sales. The margin worsens from -1.92% in 2019 to -3.03% in 2020 but then sees a slight recovery in 2021 to -2.69%. The margin improves considerably in 2022 to -0.38%, suggesting enhanced efficiency or profitability. However, this improvement declines again in 2023 to -2.22%, reflecting a decrease in profitability relative to sales volume.
- Summary
- Overall, net sales increase substantially over the five years, indicating growing revenue streams. Despite increased sales, the company struggles with negative economic profit, suggesting that cost structures or capital charges offset revenue gains. The temporary improvement in economic profit and margin in 2022 points to potential operational or financial adjustments that year, but these gains are not sustained into 2023. This pattern implies ongoing challenges in achieving positive economic value added despite strong sales performance.