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 Profitability Ratios
- Analysis of Solvency Ratios
- Analysis of Long-term (Investment) Activity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Current Ratio since 2005
- Price to Earnings (P/E) since 2005
- Price to Operating Profit (P/OP) since 2005
- Price to Sales (P/S) since 2005
- Analysis of Debt
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MVA
Caterpillar Inc., MVA calculation
US$ in millions
Based on: 10-K (reporting date: 2025-12-31), 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).
1 Fair value of debt. See details »
2 Invested capital. See details »
The market value of the company demonstrates a consistent upward trajectory over the five-year period. Invested capital also generally increased, though with some fluctuation. Consequently, market value added (MVA) exhibited a strong positive trend, indicating increasing shareholder wealth creation.
- Market Value
- The market value increased from US$147,256 million in 2021 to US$399,963 million in 2025. Growth was steady from 2021 to 2023, with a significant acceleration in 2025. The increase from 2024 to 2025 was particularly substantial, representing a near doubling of the market value.
- Invested Capital
- Invested capital experienced a slight decrease between 2021 and 2022, falling from US$55,552 million to US$54,801 million. It then stabilized and increased gradually through 2024, reaching US$57,519 million. A more pronounced increase occurred between 2024 and 2025, rising to US$64,653 million. While positive overall, the growth in invested capital was less dramatic than that of the market value.
- Market Value Added (MVA)
- MVA rose consistently throughout the period, starting at US$91,704 million in 2021 and reaching US$335,310 million in 2025. The rate of increase in MVA mirrored the acceleration in market value, with a particularly large jump between 2024 and 2025. This suggests that the company is generating returns on invested capital that exceed its cost of capital, resulting in substantial value creation for shareholders.
The widening gap between the growth of market value and invested capital suggests increasing efficiency in capital allocation and/or improved profitability. The substantial increase in MVA in the final year of the period indicates a particularly strong performance and positive market perception.
MVA Spread Ratio
Caterpillar Inc., MVA spread ratio calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Market value added (MVA)1 | ||||||
| Invested capital2 | ||||||
| Performance Ratio | ||||||
| MVA spread ratio3 | ||||||
| Benchmarks | ||||||
| MVA Spread Ratio, Competitors4 | ||||||
| Boeing Co. | ||||||
| Eaton Corp. plc | ||||||
| GE Aerospace | ||||||
| Honeywell International Inc. | ||||||
| Lockheed Martin Corp. | ||||||
| RTX Corp. | ||||||
Based on: 10-K (reporting date: 2025-12-31), 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).
1 MVA. See details »
2 Invested capital. See details »
3 2025 Calculation
MVA spread ratio = 100 × MVA ÷ Invested capital
= 100 × ÷ =
4 Click competitor name to see calculations.
The Market Value Added (MVA) exhibited a consistent upward trajectory between 2021 and 2025. Initially, MVA increased from US$91,704 million in 2021 to US$106,493 million in 2022, representing a growth of approximately 16.1%. This growth accelerated in subsequent years, reaching US$137,177 million in 2023 and US$145,115 million in 2024. The most substantial increase occurred between 2024 and 2025, with MVA more than doubling to US$335,310 million.
Invested capital demonstrated a more moderate pattern of change. A slight decrease was observed from 2021 to 2022, falling from US$55,552 million to US$54,801 million. Following this, invested capital remained relatively stable between 2022 and 2024, with incremental increases to US$55,518 million and US$57,519 million respectively. A more noticeable increase occurred in 2025, with invested capital rising to US$64,653 million.
- MVA Spread Ratio
- The MVA spread ratio, expressed as a percentage, consistently increased throughout the observed period. Starting at 165.08% in 2021, the ratio rose to 194.33% in 2022 and continued to climb to 247.08% in 2023. The rate of increase slowed slightly in 2024, reaching 252.29%. However, a significant surge was evident in 2025, with the MVA spread ratio reaching 518.63%. This substantial increase suggests a widening gap between the market value created and the capital invested.
The accelerating growth in the MVA spread ratio, particularly in 2025, indicates that the company is generating a significantly higher return relative to its invested capital. While invested capital increased, the growth in MVA outpaced it considerably, driving the substantial increase in the spread ratio. This suggests improved efficiency in capital allocation and value creation.
MVA Margin
Caterpillar Inc., MVA margin calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Market value added (MVA)1 | ||||||
| Sales of Machinery, Power & Energy | ||||||
| Performance Ratio | ||||||
| MVA margin2 | ||||||
| Benchmarks | ||||||
| MVA Margin, Competitors3 | ||||||
| Boeing Co. | ||||||
| Eaton Corp. plc | ||||||
| GE Aerospace | ||||||
| Honeywell International Inc. | ||||||
| Lockheed Martin Corp. | ||||||
| RTX Corp. | ||||||
Based on: 10-K (reporting date: 2025-12-31), 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).
1 MVA. See details »
2 2025 Calculation
MVA margin = 100 × MVA ÷ Sales of Machinery, Power & Energy
= 100 × ÷ =
3 Click competitor name to see calculations.
The Market Value Added (MVA) exhibited a consistent upward trajectory between 2021 and 2025. Simultaneously, Sales of Machinery, Power & Energy demonstrated growth, although with a slight dip in 2024. The MVA margin, calculated as a percentage, reveals a significant acceleration in value creation relative to sales over the observed period.
- Market Value Added (MVA)
- The MVA increased from US$91,704 million in 2021 to US$335,310 million in 2025. Growth was substantial, with a particularly large increase occurring between 2024 and 2025. This indicates a growing difference between the market value of the company and its capital employed.
- Sales of Machinery, Power & Energy
- Sales rose from US$48,188 million in 2021 to US$63,869 million in 2023, representing a period of strong revenue expansion. A decrease to US$61,363 million was noted in 2024, followed by a modest recovery to US$63,980 million in 2025. While sales generally increased, the rate of growth slowed in the latter years.
- MVA Margin
- The MVA margin began at 190.31% in 2021 and increased to 524.09% in 2025. This represents a substantial improvement in the efficiency with which the company is generating value for its investors. The margin experienced consistent growth, accelerating significantly in the final two years of the period. The increase in the MVA margin suggests that the company is becoming increasingly effective at converting sales into shareholder value, even with the slight sales dip in 2024.
The divergence between the sales trend and the MVA margin trend is noteworthy. While sales experienced a minor decline in 2024, the MVA margin continued to increase, suggesting improved operational efficiency, cost management, or a reassessment of the company’s future prospects by the market. The substantial increase in MVA and its margin in 2025 indicates a strong positive market reaction, potentially driven by anticipated future performance or strategic initiatives.