Free Cash Flow to Equity (FCFE)
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).
- Net Cash Provided by Operating Activities
- The net cash provided by operating activities exhibited fluctuations over the five-year period. Starting at 15,865 million USD in 2020, it increased to a peak of 18,265 million USD in 2021. This was followed by a decline to 16,177 million USD in 2022 and a further decrease to 13,426 million USD in 2023. The downward trend continued into 2024, reaching 9,107 million USD. Overall, the data indicates a weakening in operating cash flow generation after 2021.
- Free Cash Flow to Equity (FCFE)
- The free cash flow to equity showed a different pattern compared to operating cash flow. It started at 7,755 million USD in 2020 and then declined to 6,478 million USD in 2021. However, it rebounded significantly in 2022, increasing to 9,239 million USD. In 2023, FCFE surged dramatically to 18,327 million USD, more than doubling the previous year's value. This was followed by a decrease in 2024 to 11,385 million USD, though the level remained substantially higher than the values before 2023. This pattern suggests variability in capital expenditures or financing activities affecting the company's equity cash flow.
- Overall Insight
- While operating cash flow showed a peak in 2021 followed by a steady decline, free cash flow to equity exhibited more volatility with a notable spike in 2023. This divergence might indicate changes in investment activities or capital structure decisions impacting available cash flows to equity holders. The substantial increase in FCFE in 2023, despite a decrease in operating cash flow, could imply lower capital expenditures or significant inflows from financing sources that year. The subsequent decline in both measures in 2024 suggests a potential normalization or adjustment after the fluctuations.
Price to FCFE Ratio, Current
No. shares of common stock outstanding | 1,265,019,429 |
Selected Financial Data (US$) | |
Free cash flow to equity (FCFE) (in millions) | 11,385) |
FCFE per share | 9.00 |
Current share price (P) | 69.45 |
Valuation Ratio | |
P/FCFE | 7.72 |
Benchmarks | |
P/FCFE, Competitors1 | |
Abbott Laboratories | 39.44 |
Elevance Health Inc. | 6.48 |
Intuitive Surgical Inc. | 132.05 |
Medtronic PLC | 16.27 |
UnitedHealth Group Inc. | 7.79 |
P/FCFE, Sector | |
Health Care Equipment & Services | 14.55 |
P/FCFE, Industry | |
Health Care | 17.56 |
Based on: 10-K (reporting date: 2024-12-31).
1 Click competitor name to see calculations.
If the company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.
Otherwise, if the company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.
Price to FCFE Ratio, Historical
Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
---|---|---|---|---|---|---|
No. shares of common stock outstanding1 | 1,260,795,063 | 1,258,449,553 | 1,284,111,667 | 1,312,510,426 | 1,311,354,926 | |
Selected Financial Data (US$) | ||||||
Free cash flow to equity (FCFE) (in millions)2 | 11,385) | 18,327) | 9,239) | 6,478) | 7,755) | |
FCFE per share3 | 9.03 | 14.56 | 7.19 | 4.94 | 5.91 | |
Share price1, 4 | 63.22 | 76.05 | 88.96 | 104.79 | 70.53 | |
Valuation Ratio | ||||||
P/FCFE5 | 7.00 | 5.22 | 12.36 | 21.23 | 11.93 | |
Benchmarks | ||||||
P/FCFE, Competitors6 | ||||||
Abbott Laboratories | 40.25 | 76.56 | 26.11 | 24.52 | 38.42 | |
Elevance Health Inc. | 8.26 | 16.04 | 14.26 | 11.07 | 7.75 | |
Intuitive Surgical Inc. | 156.44 | 177.77 | 89.67 | 58.39 | 81.15 | |
Medtronic PLC | 16.39 | 29.20 | 19.71 | 38.91 | 23.06 | |
UnitedHealth Group Inc. | 12.12 | 15.33 | 12.57 | 20.11 | 13.93 | |
P/FCFE, Sector | ||||||
Health Care Equipment & Services | 17.78 | 22.95 | 16.47 | 22.14 | 18.61 | |
P/FCFE, Industry | ||||||
Health Care | 19.35 | 18.18 | 18.40 | 17.94 | 17.51 |
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 Data adjusted for splits and stock dividends.
3 2024 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= 11,385,000,000 ÷ 1,260,795,063 = 9.03
4 Closing price as at the filing date of CVS Health Corp. Annual Report.
5 2024 Calculation
P/FCFE = Share price ÷ FCFE per share
= 63.22 ÷ 9.03 = 7.00
6 Click competitor name to see calculations.
- Share Price Trend
- The share price exhibited an initial upward trend from 70.53 USD at the end of 2020 to a peak of 104.79 USD at the end of 2021. Subsequently, it decreased consistently over the next three years, falling to 88.96 USD in 2022, 76.05 USD in 2023, and further down to 63.22 USD in 2024. This indicates a significant correction or decline in market valuation following the peak in 2021.
- Free Cash Flow to Equity (FCFE) per Share
- FCFE per share showed some volatility but an overall increasing trend over the five-year period. It declined from 5.91 USD in 2020 to 4.94 USD in 2021, followed by a notable increase to 7.19 USD in 2022. The FCFE per share peaked at 14.56 USD in 2023 before declining to 9.03 USD in 2024. This pattern suggests that the company increased its ability to generate free cash flow for equity holders particularly after 2021, despite the later drop in 2024.
- Price to FCFE (P/FCFE) Ratio
- The P/FCFE ratio demonstrates significant fluctuation corresponding inversely to changes in share price and FCFE per share. It rose sharply from 11.93 in 2020 to 21.23 in 2021, reflecting a higher market price relative to FCFE, likely due to the rising share price and lower FCFE that year. The ratio then declined to 12.36 in 2022 and further to a low of 5.22 in 2023, indicating the market price became more attractive relative to the cash flows. In 2024, the ratio increased again to 7.00, corresponding with a decrease in FCFE per share and share price.
- Overall Financial Insights
- The data shows that after an initial surge in market valuation by the end of 2021, the company's stock price corrected downward consistently into 2024. Meanwhile, free cash flow generation per share increased significantly particularly in 2023, implying improved operational cash generation capability. The P/FCFE ratio indicates the stock was relatively overvalued at the end of 2021 but became undervalued in terms of cash flow by 2023 before slightly correcting higher in 2024. Such fluctuations may reflect changes in market sentiment, operational performance, or external factors impacting valuation.