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.
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Dell Technologies Inc. pages available for free this week:
- Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Liquidity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Common Stock Valuation Ratios
- Present Value of Free Cash Flow to Equity (FCFE)
- Return on Equity (ROE) since 2019
- Return on Assets (ROA) since 2019
- Current Ratio since 2019
- Price to Earnings (P/E) since 2019
- Aggregate Accruals
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Economic Profit
Dell Technologies Inc., economic profit calculation
US$ in millions
| 12 months ended: | Jan 31, 2025 | Feb 2, 2024 | Feb 3, 2023 | Jan 28, 2022 | Jan 29, 2021 | Jan 31, 2020 | |
|---|---|---|---|---|---|---|---|
| Net operating profit after taxes (NOPAT)1 | |||||||
| Cost of capital2 | |||||||
| Invested capital3 | |||||||
| Economic profit4 | |||||||
Based on: 10-K (reporting date: 2025-01-31), 10-K (reporting date: 2024-02-02), 10-K (reporting date: 2023-02-03), 10-K (reporting date: 2022-01-28), 10-K (reporting date: 2021-01-29), 10-K (reporting date: 2020-01-31).
1 NOPAT. See details »
2 Cost of capital. See details »
3 Invested capital. See details »
4 2025 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= – × =
Net Operating Profit after Taxes (NOPAT)
Dell Technologies Inc., NOPAT calculation
US$ in millions
Based on: 10-K (reporting date: 2025-01-31), 10-K (reporting date: 2024-02-02), 10-K (reporting date: 2023-02-03), 10-K (reporting date: 2022-01-28), 10-K (reporting date: 2021-01-29), 10-K (reporting date: 2020-01-31).
1 Elimination of deferred tax expense. See details »
2 Addition of increase (decrease) in allowance for expected credit losses.
3 Addition of increase (decrease) in deferred revenue.
4 Addition of increase (decrease) in warranty liability.
5 Addition of increase (decrease) in severance liability.
6 Addition of increase (decrease) in equity equivalents to net income attributable to Dell Technologies Inc..
7 2025 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= × =
8 2025 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= × 21.00% =
9 Addition of after taxes interest expense to net income attributable to Dell Technologies Inc..
10 2025 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= × 21.00% =
11 Elimination of after taxes investment income.
12 Elimination of discontinued operations.
- Net income attributable to Dell Technologies Inc.
- The net income exhibited a fluctuating trend over the periods analyzed. It started at 4,616 million USD in early 2020, then declined to 3,250 million USD by early 2021. This was followed by a significant increase to 5,563 million USD in early 2022. After this peak, net income dropped sharply to 2,442 million USD in early 2023, before gradually rising again to 3,211 million USD in early 2024 and reaching 4,592 million USD in early 2025. Overall, net income showed volatility with a recovery trend towards the end of the period.
- Net operating profit after taxes (NOPAT)
- NOPAT demonstrated considerable variability during the examined timeframe. Initially, it was at 5,052 million USD in early 2020, then increased substantially to 7,942 million USD in early 2021. It remained relatively stable in early 2022 at 7,874 million USD but experienced a notable decline to 5,638 million USD in early 2023. The downward trajectory continued sharply, with NOPAT decreasing to 2,835 million USD in early 2024 and further dropping to 2,070 million USD by early 2025. This pattern indicates a peak in operating profitability around 2021-2022, followed by a sustained downward trend.
- Key Observations
- Both net income and NOPAT values experienced significant fluctuations across the reviewed years. While net income showed a recovery phase in the last two years, NOPAT declined more consistently after reaching high levels in 2021 and 2022. The divergence in the trends between net income and NOPAT in the later years may suggest changes in operational efficiency, tax impacts, or other non-operating factors affecting net income. The sustained decrease in NOPAT highlights a potential weakening in core operational profitability that merits further investigation.
Cash Operating Taxes
Dell Technologies Inc., cash operating taxes calculation
US$ in millions
Based on: 10-K (reporting date: 2025-01-31), 10-K (reporting date: 2024-02-02), 10-K (reporting date: 2023-02-03), 10-K (reporting date: 2022-01-28), 10-K (reporting date: 2021-01-29), 10-K (reporting date: 2020-01-31).
- Income tax expense (benefit)
- The income tax expense shows a significant fluctuation over the periods analyzed. In the fiscal year ending January 31, 2020, there was a notable tax benefit of -$5,533 million, indicating a tax credit or refund situation. Subsequently, the tax expense turned positive and increased from $165 million in 2021 to a peak of $981 million in 2022. After this peak, a gradual decline was observed, with expenses decreasing to $803 million in 2023, $692 million in 2024, and further down to $472 million in 2025. This trend suggests a recovery from the initial tax benefit, followed by a reduction in tax expenses in recent years, possibly reflecting changes in taxable income or tax planning strategies.
- Cash operating taxes
- Cash operating taxes exhibited variability throughout the periods. Starting at $1,348 million in 2020, the amount paid decreased to $1,071 million in 2021. This was followed by a substantial increase to $1,523 million in 2022 and further growth to $1,762 million in 2023. However, a sharp decrease is evident in the last two periods, with cash operating taxes falling to $1,042 million in 2024 and $947 million in 2025. These fluctuations indicate variability in cash tax payments, which could be attributed to changes in operating profits, tax rates, or timing differences in tax payments.
Invested Capital
Dell Technologies Inc., invested capital calculation (financing approach)
US$ in millions
Based on: 10-K (reporting date: 2025-01-31), 10-K (reporting date: 2024-02-02), 10-K (reporting date: 2023-02-03), 10-K (reporting date: 2022-01-28), 10-K (reporting date: 2021-01-29), 10-K (reporting date: 2020-01-31).
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 deferred revenue.
5 Addition of warranty liability.
6 Addition of severance liability.
7 Addition of equity equivalents to total Dell Technologies Inc. stockholders’ equity (deficit).
8 Removal of accumulated other comprehensive income.
9 Subtraction of marketable securities.
- Total reported debt & leases
-
The total reported debt and leases exhibit a significant downward trend over the observed periods. Starting from a peak of $53,848 million in January 2020, the amount decreases to $50,207 million by January 2021. A pronounced reduction is evident in the following years, with debt declining to $27,961 million by January 2022. Although there is a slight increase to $30,478 million in February 2023, the downward trajectory resumes subsequently, reaching $25,325 million by January 2025. This pattern indicates a strategic effort to reduce overall debt burden.
- Total Dell Technologies Inc. stockholders’ equity (deficit)
-
The stockholders’ equity fluctuates between positive and negative values across the periods. Initially, there is a deficit of -$1,574 million as of January 2020. This reverses to a positive equity position of $2,479 million by January 2021, suggesting improved net asset value or capital structure during that timeframe. However, the equity returns to negative territory subsequently and remains so through the latest period, with deficits ranging from -$1,685 million to -$3,122 million, before improving slightly to -$1,482 million by January 2025. The persistent negative equity in most years may indicate accumulated losses, significant liabilities, or other financial challenges impacting net worth.
- Invested capital
-
Invested capital displays an overall declining trend throughout the data set. It peaks at $83,528 million in January 2021, followed by a sharp decrease to $53,988 million in January 2022. Subsequent periods show minor fluctuations but generally continue downward, reaching $49,926 million by January 2025. This reduction in invested capital suggests a contraction in the company’s total invested resources, which may be related to decreased asset base or strategic divestitures aligned with debt reduction efforts.
Cost of Capital
Dell Technologies Inc., cost of capital calculations
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2025-01-31).
1 US$ in millions
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: 2024-02-02).
1 US$ in millions
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: 2023-02-03).
1 US$ in millions
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: 2022-01-28).
1 US$ in millions
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: 2021-01-29).
1 US$ in millions
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: 2020-01-31).
1 US$ in millions
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
Economic Spread Ratio
Dell Technologies Inc., economic spread ratio calculation, comparison to benchmarks
| Jan 31, 2025 | Feb 2, 2024 | Feb 3, 2023 | Jan 28, 2022 | Jan 29, 2021 | Jan 31, 2020 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Economic profit1 | |||||||
| Invested capital2 | |||||||
| Performance Ratio | |||||||
| Economic spread ratio3 | |||||||
| Benchmarks | |||||||
| Economic Spread Ratio, Competitors4 | |||||||
| Apple Inc. | |||||||
| Arista Networks Inc. | |||||||
| Cisco Systems Inc. | |||||||
| Super Micro Computer Inc. | |||||||
Based on: 10-K (reporting date: 2025-01-31), 10-K (reporting date: 2024-02-02), 10-K (reporting date: 2023-02-03), 10-K (reporting date: 2022-01-28), 10-K (reporting date: 2021-01-29), 10-K (reporting date: 2020-01-31).
1 Economic profit. See details »
2 Invested capital. See details »
3 2025 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × ÷ =
4 Click competitor name to see calculations.
Economic Profit Margin
Dell Technologies Inc., economic profit margin calculation, comparison to benchmarks
| Jan 31, 2025 | Feb 2, 2024 | Feb 3, 2023 | Jan 28, 2022 | Jan 29, 2021 | Jan 31, 2020 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Economic profit1 | |||||||
| Net revenue | |||||||
| Add: Increase (decrease) in deferred revenue | |||||||
| Adjusted net revenue | |||||||
| Performance Ratio | |||||||
| Economic profit margin2 | |||||||
| Benchmarks | |||||||
| Economic Profit Margin, Competitors3 | |||||||
| Apple Inc. | |||||||
| Arista Networks Inc. | |||||||
| Cisco Systems Inc. | |||||||
| Super Micro Computer Inc. | |||||||
Based on: 10-K (reporting date: 2025-01-31), 10-K (reporting date: 2024-02-02), 10-K (reporting date: 2023-02-03), 10-K (reporting date: 2022-01-28), 10-K (reporting date: 2021-01-29), 10-K (reporting date: 2020-01-31).
1 Economic profit. See details »
2 2025 Calculation
Economic profit margin = 100 × Economic profit ÷ Adjusted net revenue
= 100 × ÷ =
3 Click competitor name to see calculations.