Stock Analysis on Net

Elevance Health Inc. (NYSE:ELV)

Analysis of Goodwill and Intangible Assets

Microsoft Excel

Goodwill and Intangible Asset Disclosure

Elevance Health Inc., balance sheet: goodwill and intangible assets

US$ in millions

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Goodwill 25,317 24,383 24,228 21,691 20,500
Customer relationships 6,263 5,791 5,598 5,180 4,500
Provider and hospital relationships 326 326 324 323 228
Other 242 1,010 610 444 352
Intangible assets with finite lives, gross carrying amount 6,831 7,127 6,532 5,947 5,080
Accumulated amortization (4,025) (4,279) (3,506) (4,057) (3,696)
Intangible assets with finite lives, net carrying amount 2,806 2,848 3,026 1,890 1,384
Blue Cross and Blue Shield and other trademarks 5,991 5,991 6,299 6,299 6,299
State Medicaid licenses 1,476 1,476 1,290 1,216 991
Intangible assets with indefinite lives 7,467 7,467 7,589 7,515 7,290
Other intangible assets 10,273 10,315 10,615 9,405 8,674
Goodwill and other intangible assets 35,590 34,698 34,843 31,096 29,174

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).

Item Description The company
Goodwill Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Elevance Health Inc. goodwill increased from 2021 to 2022 and from 2022 to 2023.
Other intangible assets Sum of the carrying amounts of all intangible assets, excluding goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. Elevance Health Inc. other intangible assets decreased from 2021 to 2022 and from 2022 to 2023.
Goodwill and other intangible assets Sum of the carrying amounts of all intangible assets, including goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. Elevance Health Inc. goodwill and other intangible assets decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.

Adjustments to Financial Statements: Removal of Goodwill

Elevance Health Inc., adjustments to financial statements

US$ in millions

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Adjustment to Total Assets
Total assets (as reported) 108,928 102,772 97,460 86,615 77,453
Less: Goodwill 25,317 24,383 24,228 21,691 20,500
Total assets (adjusted) 83,611 78,389 73,232 64,924 56,953
Adjustment to Shareholders’ Equity
Shareholders’ equity (as reported) 39,306 36,307 36,060 33,199 31,728
Less: Goodwill 25,317 24,383 24,228 21,691 20,500
Shareholders’ equity (adjusted) 13,989 11,924 11,832 11,508 11,228

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).


Elevance Health Inc., Financial Data: Reported vs. Adjusted


Adjusted Financial Ratios: Removal of Goodwill (Summary)

Elevance Health Inc., adjusted financial ratios

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Total Asset Turnover
Reported total asset turnover 1.56 1.51 1.41 1.39 1.33
Adjusted total asset turnover 2.04 1.99 1.87 1.86 1.81
Financial Leverage
Reported financial leverage 2.77 2.83 2.70 2.61 2.44
Adjusted financial leverage 5.98 6.57 6.19 5.64 5.07
Return on Equity (ROE)
Reported ROE 15.23% 16.59% 16.93% 13.77% 15.15%
Adjusted ROE 42.80% 50.53% 51.59% 39.73% 42.81%
Return on Assets (ROA)
Reported ROA 5.50% 5.86% 6.26% 5.28% 6.21%
Adjusted ROA 7.16% 7.69% 8.34% 7.04% 8.44%

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).

Financial ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Elevance Health Inc. adjusted total asset turnover ratio improved from 2021 to 2022 and from 2022 to 2023.
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.
Elevance Health Inc. adjusted financial leverage ratio increased from 2021 to 2022 but then decreased significantly from 2022 to 2023.
Adjusted ROE A profitability ratio calculated as net income divided by adjusted shareholders’ equity. Elevance Health Inc. adjusted ROE deteriorated from 2021 to 2022 and from 2022 to 2023.
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Elevance Health Inc. adjusted ROA deteriorated from 2021 to 2022 and from 2022 to 2023.

Elevance Health Inc., Financial Ratios: Reported vs. Adjusted


Adjusted Total Asset Turnover

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Operating revenue 170,209 155,660 136,943 120,808 103,141
Total assets 108,928 102,772 97,460 86,615 77,453
Activity Ratio
Total asset turnover1 1.56 1.51 1.41 1.39 1.33
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Operating revenue 170,209 155,660 136,943 120,808 103,141
Adjusted total assets 83,611 78,389 73,232 64,924 56,953
Activity Ratio
Adjusted total asset turnover2 2.04 1.99 1.87 1.86 1.81

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).

2023 Calculations

1 Total asset turnover = Operating revenue ÷ Total assets
= 170,209 ÷ 108,928 = 1.56

2 Adjusted total asset turnover = Operating revenue ÷ Adjusted total assets
= 170,209 ÷ 83,611 = 2.04

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Elevance Health Inc. adjusted total asset turnover ratio improved from 2021 to 2022 and from 2022 to 2023.

Adjusted Financial Leverage

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Total assets 108,928 102,772 97,460 86,615 77,453
Shareholders’ equity 39,306 36,307 36,060 33,199 31,728
Solvency Ratio
Financial leverage1 2.77 2.83 2.70 2.61 2.44
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Adjusted total assets 83,611 78,389 73,232 64,924 56,953
Adjusted shareholders’ equity 13,989 11,924 11,832 11,508 11,228
Solvency Ratio
Adjusted financial leverage2 5.98 6.57 6.19 5.64 5.07

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).

2023 Calculations

1 Financial leverage = Total assets ÷ Shareholders’ equity
= 108,928 ÷ 39,306 = 2.77

2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted shareholders’ equity
= 83,611 ÷ 13,989 = 5.98

Solvency ratio Description The company
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.
Elevance Health Inc. adjusted financial leverage ratio increased from 2021 to 2022 but then decreased significantly from 2022 to 2023.

Adjusted Return on Equity (ROE)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Shareholders’ net income 5,987 6,025 6,104 4,572 4,807
Shareholders’ equity 39,306 36,307 36,060 33,199 31,728
Profitability Ratio
ROE1 15.23% 16.59% 16.93% 13.77% 15.15%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Shareholders’ net income 5,987 6,025 6,104 4,572 4,807
Adjusted shareholders’ equity 13,989 11,924 11,832 11,508 11,228
Profitability Ratio
Adjusted ROE2 42.80% 50.53% 51.59% 39.73% 42.81%

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).

2023 Calculations

1 ROE = 100 × Shareholders’ net income ÷ Shareholders’ equity
= 100 × 5,987 ÷ 39,306 = 15.23%

2 Adjusted ROE = 100 × Shareholders’ net income ÷ Adjusted shareholders’ equity
= 100 × 5,987 ÷ 13,989 = 42.80%

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as net income divided by adjusted shareholders’ equity. Elevance Health Inc. adjusted ROE deteriorated from 2021 to 2022 and from 2022 to 2023.

Adjusted Return on Assets (ROA)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Shareholders’ net income 5,987 6,025 6,104 4,572 4,807
Total assets 108,928 102,772 97,460 86,615 77,453
Profitability Ratio
ROA1 5.50% 5.86% 6.26% 5.28% 6.21%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Shareholders’ net income 5,987 6,025 6,104 4,572 4,807
Adjusted total assets 83,611 78,389 73,232 64,924 56,953
Profitability Ratio
Adjusted ROA2 7.16% 7.69% 8.34% 7.04% 8.44%

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).

2023 Calculations

1 ROA = 100 × Shareholders’ net income ÷ Total assets
= 100 × 5,987 ÷ 108,928 = 5.50%

2 Adjusted ROA = 100 × Shareholders’ net income ÷ Adjusted total assets
= 100 × 5,987 ÷ 83,611 = 7.16%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Elevance Health Inc. adjusted ROA deteriorated from 2021 to 2022 and from 2022 to 2023.