Enterprise Value to FCFF (EV/FCFF)
Free Cash Flow to The Firm (FCFF)
ExxonMobil Holdings Corp., FCFF 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).
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The financial trajectory between 2021 and 2025 is characterized by a significant peak in liquidity during the 2022 fiscal year, followed by a progressive decline in free cash flow generation. While operating cash flows have remained relatively resilient after the initial peak, the free cash flow to the firm exhibits a more pronounced and sustained downward trend.
- Operating Cash Flow Analysis
- Net cash provided by operating activities experienced a sharp increase from 48,129 million US$ in 2021 to a peak of 76,797 million US$ in 2022. Following this spike, a contraction occurred in 2023, after which operating cash flows stabilized, maintaining a range between 51,970 million US$ and 55,369 million US$ through 2025.
- Free Cash Flow to the Firm (FCFF) Trends
- FCFF followed a similar upward trajectory initially, peaking at 59,398 million US$ in 2022. However, beginning in 2023, FCFF entered a consistent decline, falling to 34,613 million US$ in 2023, 31,989 million US$ in 2024, and reaching 24,873 million US$ by 2025. This represents a significant reduction in the cash available to all capital providers compared to the 2022 high.
- Cash Flow Conversion and Capital Expenditure Insights
- A widening divergence is observed between operating cash flows and FCFF. In 2021 and 2022, FCFF represented approximately 77% of net cash provided by operating activities. By 2025, this conversion rate declined to approximately 48%. This trend indicates that a larger portion of operating cash is being allocated toward capital expenditures or other investments, reducing the net free cash flow available to the firm.
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Interest Paid, Net of Tax
ExxonMobil Holdings Corp., interest paid, net of tax 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).
2 2025 Calculation
Cash interest paid, tax = Cash interest paid × EITR
= 218 × 28.00% = 61
3 2025 Calculation
Interest capitalized, tax = Interest capitalized × EITR
= 1,534 × 28.00% = 430
An analysis of the financial data from 2021 to 2025 reveals a divergent trend between cash interest payments and capitalized interest, coinciding with a generally stable but eventually declining effective income tax rate.
- Cash Interest Paid, Net of Tax
- A general downward trajectory is observed in cash interest payments. From a peak of 565 million USD in 2021, the amount decreased to 391 million USD by 2023. Despite a marginal increase to 418 million USD in 2024, a significant reduction occurred in 2025, with payments falling to 157 million USD. This represents a substantial decrease in immediate cash outflows related to interest over the five-year period.
- Interest Capitalized, Net of Tax
- In contrast to cash payments, capitalized interest shows a consistent and accelerated upward trend. Starting at 452 million USD in 2021, the figure rose steadily to 1.104 billion USD by 2025. The continuous growth in capitalized interest suggests an increase in the scale or duration of long-term capital projects, as interest costs are being shifted from the income statement to the balance sheet.
- Effective Income Tax Rate (EITR)
- The effective income tax rate remained relatively constant at 33% between 2022 and 2024, following an initial rate of 31% in 2021. A notable decline to 28% is recorded in 2025. This reduction in the tax rate likely contributes to the lower net-of-tax figures reported in the final year, as the tax shield provided by interest expenses is adjusted.
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Enterprise Value to FCFF Ratio, Current
ExxonMobil Holdings Corp., current EV/FCFF calculation, comparison to benchmarks
| Selected Financial Data (US$ in millions) | |
| Enterprise value (EV) | 773,010) |
| Free cash flow to the firm (FCFF) | 24,873) |
| Valuation Ratio | |
| EV/FCFF | 31.08 |
| Benchmarks | |
| EV/FCFF, Competitors1 | |
| Chevron Corp. | 28.34 |
| ConocoPhillips | 24.22 |
| EV/FCFF, Sector | |
| Oil, Gas & Consumable Fuels | 29.02 |
| EV/FCFF, Industry | |
| Energy | 28.18 |
Based on: 10-K (reporting date: 2025-12-31).
1 Click competitor name to see calculations.
If the company EV/FCFF is lower then the EV/FCFF of benchmark then company is relatively undervalued.
Otherwise, if the company EV/FCFF is higher then the EV/FCFF of benchmark then company is relatively overvalued.
Enterprise Value to FCFF Ratio, Historical
ExxonMobil Holdings Corp., historical EV/FCFF 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) | ||||||
| Enterprise value (EV)1 | 667,944) | 504,190) | 431,696) | 465,686) | 373,021) | |
| Free cash flow to the firm (FCFF)2 | 24,873) | 31,989) | 34,613) | 59,398) | 37,070) | |
| Valuation Ratio | ||||||
| EV/FCFF3 | 26.85 | 15.76 | 12.47 | 7.84 | 10.06 | |
| Benchmarks | ||||||
| EV/FCFF, Competitors4 | ||||||
| Chevron Corp. | 23.70 | 18.98 | 14.85 | 8.27 | 13.33 | |
| ConocoPhillips | 18.77 | 16.31 | 15.38 | 7.43 | 10.72 | |
| EV/FCFF, Sector | ||||||
| Oil, Gas & Consumable Fuels | 24.46 | 16.71 | 13.63 | 7.91 | 11.15 | |
| EV/FCFF, Industry | ||||||
| Energy | 23.94 | 16.61 | 13.96 | 8.54 | 11.54 | |
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).
3 2025 Calculation
EV/FCFF = EV ÷ FCFF
= 667,944 ÷ 24,873 = 26.85
4 Click competitor name to see calculations.
The enterprise value to free cash flow to the firm (EV/FCFF) ratio demonstrates a significant upward trajectory over the analyzed period, indicating a substantial expansion in the valuation multiple. After a brief contraction in 2022, the ratio has increased aggressively, reflecting a growing divergence between the firm's total value and its ability to generate free cash flow.
- Enterprise Value (EV) Trends
- A general upward trend in enterprise value is observed, rising from 373,021 million in 2021 to 667,944 million by 2025. Despite a slight correction in 2023, the overall movement indicates a significant increase in the total market valuation of the entity.
- Free Cash Flow to the Firm (FCFF) Performance
- Cash flow generation reached a peak in 2022 at 59,398 million but entered a period of steady decline thereafter. By 2025, FCFF fell to 24,873 million, marking a consistent reduction in the cash available to satisfy both debt and equity holders.
- EV/FCFF Ratio Interpretation
- The ratio fluctuated from 10.06 in 2021 to a low of 7.84 in 2022, driven by the temporary surge in free cash flow. However, the subsequent years show a sharp escalation, reaching 26.85 by 2025. This pattern suggests that the increase in enterprise value is not being supported by proportional growth in cash flow, resulting in a significantly higher valuation multiple.
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