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.
Paying user area
Try for free
International Business Machines Corp. pages available for free this week:
The data is hidden behind: . Unhide it.
Get full access to the entire website from $10.42/mo, or
get 1-month access to International Business Machines Corp. for $24.99.
This is a one-time payment. There is no automatic renewal.
We accept:
MVA
International Business Machines Corp., MVA calculation
US$ in millions
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 Fair value of debt. See details »
2 Invested capital. See details »
- Market (fair) value of IBM
- The market value exhibited a fluctuating trend over the five-year span. It started at $181,099 million in 2020, then decreased in the subsequent two years, reaching $166,821 million in 2022. However, from 2023 onward, there was a substantial increase, peaking at $294,221 million in 2024. The data indicates a strong recovery and growth in market valuation in the later years, particularly a pronounced rise between 2023 and 2024.
- Invested capital
- Invested capital showed a declining pattern initially, dropping from $130,176 million in 2020 to a low of $104,131 million in 2022. After this point, the invested capital recovered slightly to $112,927 million in 2023 but then experienced a minor decrease again to $111,965 million in 2024. Overall, the invested capital remained relatively stable in the later years compared to the earlier decline.
- Market value added (MVA)
- The market value added consistently increased throughout the period, indicating enhanced market perception and shareholder value creation. Starting at $50,923 million in 2020, MVA rose steadily each year, with a notable jump from $62,690 million in 2022 to $113,645 million in 2023. The growth continued vigorously, reaching $182,256 million by the end of 2024. This persistent upward trend in MVA reflects improving market confidence and value generation above the invested capital.
MVA Spread Ratio
International Business Machines Corp., MVA spread ratio calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Market value added (MVA)1 | ||||||
| Invested capital2 | ||||||
| Performance Ratio | ||||||
| MVA spread ratio3 | ||||||
| Benchmarks | ||||||
| MVA Spread Ratio, Competitors4 | ||||||
| Accenture PLC | ||||||
| Adobe Inc. | ||||||
| Cadence Design Systems Inc. | ||||||
| CrowdStrike Holdings Inc. | ||||||
| Fair Isaac Corp. | ||||||
| Intuit Inc. | ||||||
| Microsoft Corp. | ||||||
| Oracle Corp. | ||||||
| Palantir Technologies Inc. | ||||||
| Palo Alto Networks Inc. | ||||||
| Salesforce Inc. | ||||||
| ServiceNow Inc. | ||||||
| Synopsys Inc. | ||||||
| Workday Inc. | ||||||
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 MVA. See details »
2 Invested capital. See details »
3 2024 Calculation
MVA spread ratio = 100 × MVA ÷ Invested capital
= 100 × ÷ =
4 Click competitor name to see calculations.
- Market Value Added (MVA)
- The market value added shows a consistently increasing trend over the five-year period. Starting at 50,923 million US dollars at the end of 2020, the figure increases moderately through 2021 and 2022, reaching 62,690 million US dollars. A notable surge is evident from 2022 to 2023, where MVA jumps significantly to 113,645 million US dollars, followed by another substantial rise reaching 182,256 million US dollars by the end of 2024.
- Invested Capital
- The invested capital exhibits a somewhat fluctuating pattern. Initially, it decreases from 130,176 million US dollars in 2020 to 110,083 million in 2021, and further declines to 104,131 million in 2022. However, it recovers slightly in 2023 to 112,927 million before a minor reduction to 111,965 million in 2024. Overall, invested capital remains relatively stable towards the end of the period, close to the 110,000 million mark.
- MVA Spread Ratio
- The MVA spread ratio demonstrates a strong positive trend, indicating an increasing return on the invested capital relative to the market value added. Starting at 39.12% in 2020, it rises steadily to 54.96% in 2021, then to 60.2% in 2022. A sharp increase occurs in 2023, with the ratio reaching 100.64%, followed by a further substantial increase to 162.78% by 2024. This trend highlights improving value creation over time.
- Summary
- Overall, the data indicates a clear enhancement in value creation as reflected by the significant upward trend in market value added and MVA spread ratio, particularly after 2022. While invested capital experiences some fluctuations, it remains relatively steady in the last two years. The substantial growth in market value added versus a relatively stable invested capital base suggests improved efficiency or market perception of value, leading to higher returns on invested capital over the period.
MVA Margin
International Business Machines Corp., MVA margin calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Market value added (MVA)1 | ||||||
| Revenue | ||||||
| Add: Increase (decrease) in deferred income | ||||||
| Adjusted revenue | ||||||
| Performance Ratio | ||||||
| MVA margin2 | ||||||
| Benchmarks | ||||||
| MVA Margin, Competitors3 | ||||||
| Accenture PLC | ||||||
| Adobe Inc. | ||||||
| Cadence Design Systems Inc. | ||||||
| CrowdStrike Holdings Inc. | ||||||
| Fair Isaac Corp. | ||||||
| Intuit Inc. | ||||||
| Microsoft Corp. | ||||||
| Oracle Corp. | ||||||
| Palantir Technologies Inc. | ||||||
| Palo Alto Networks Inc. | ||||||
| Salesforce Inc. | ||||||
| ServiceNow Inc. | ||||||
| Synopsys Inc. | ||||||
| Workday Inc. | ||||||
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 MVA. See details »
2 2024 Calculation
MVA margin = 100 × MVA ÷ Adjusted revenue
= 100 × ÷ =
3 Click competitor name to see calculations.
- Market Value Added (MVA)
- The Market Value Added demonstrates a consistent upward trend over the five-year period. Starting from approximately 50.9 billion US dollars in 2020, it increased moderately to about 60.5 billion in 2021 and 62.7 billion in 2022. A significant acceleration is observed from 2023 onwards, with MVA reaching 113.6 billion and further surging to 182.3 billion in 2024. This sharp rise in the last two years indicates a substantial increase in the company's market value relative to its invested capital.
- Adjusted Revenue
- Adjusted revenue reveals a distinct pattern characterized by a decline followed by a mild recovery and stabilization. The revenue starts at 74.9 billion US dollars in 2020, then drops sharply to 57.7 billion in 2021. There is a slight increase in 2022 to nearly 60.0 billion, continuing with a modest rise in 2023 to 63.3 billion. In 2024, the revenue slightly decreases again, ending at approximately 63.3 billion. The data suggests challenges in top-line growth after 2020, with a relatively flat trend in recent years.
- MVA Margin (%)
- The MVA margin, which measures market value added relative to revenue, exhibits a remarkable increasing trend throughout the period. The margin increases from 68.01% in 2020 to above 100% in 2021 and 2022, indicating the market value added surpassing the adjusted revenue by a substantial margin. This upward trajectory continues sharply in 2023 and 2024, with margins soaring to 179.5% and then 287.93%, respectively. This growing ratio reflects enhanced efficiency or investor confidence translating to higher market valuation relative to revenue generated.
- Summary of Trends
- Overall, the data reflects a disconnect between adjusted revenue and market value added. While adjusted revenue has declined since 2020 and stabilized without significant growth, MVA has increased markedly, especially from 2023 onwards. This divergence points to increased market optimism or intangible value generation not directly captured by revenue figures. The surging MVA margin reinforces the interpretation of heightened market valuation efficiency or improved perception of future growth potential despite modest revenue changes.