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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- Balance Sheet: Assets
- Analysis of Long-term (Investment) Activity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Analysis of Reportable Segments
- Enterprise Value to EBITDA (EV/EBITDA)
- Price to FCFE (P/FCFE)
- Capital Asset Pricing Model (CAPM)
- Price to Earnings (P/E) since 2005
- Price to Sales (P/S) since 2005
- Aggregate Accruals
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MVA
Johnson & Johnson, MVA calculation
US$ in millions
Based on: 10-K (reporting date: 2025-12-28), 10-K (reporting date: 2024-12-29), 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 period under review demonstrates fluctuating performance in market value and invested capital, resulting in corresponding changes in market value added. Initial observations reveal a decline in both market value and MVA from 2021 to 2023, followed by a recovery in 2024 and substantial growth in 2025.
- Market Value
- The market value experienced a decrease from US$457,788 million in 2021 to US$405,457 million in 2023. A modest increase to US$414,015 million was noted in 2024, but a significant surge to US$627,688 million occurred in 2025. This indicates a period of investor uncertainty followed by renewed confidence or a positive shift in market perception.
- Invested Capital
- Invested capital increased from US$98,066 million in 2021 to US$113,818 million in 2022, before decreasing to US$99,118 million in 2023. Further increases were observed in 2024 (US$106,513 million) and 2025 (US$138,153 million). The growth in invested capital suggests ongoing investment in the business, potentially contributing to the later market value recovery.
- Market Value Added (MVA)
- MVA followed a similar pattern to market value, declining from US$359,722 million in 2021 to US$306,339 million in 2023. A slight increase to US$307,502 million was recorded in 2024, with a substantial increase to US$489,535 million in 2025. The significant rise in MVA in 2025 suggests that the market increasingly values the company’s invested capital and future prospects.
The correlation between market value and MVA is strong, indicating that changes in market perception directly impact the value created above the cost of capital. The increase in invested capital alongside the recovery and subsequent growth in market value and MVA suggests that strategic investments may be contributing to enhanced shareholder value, particularly as evidenced by the 2025 figures.
MVA Spread Ratio
Johnson & Johnson, MVA spread ratio calculation, comparison to benchmarks
| Dec 28, 2025 | Dec 29, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Market value added (MVA)1 | ||||||
| Invested capital2 | ||||||
| Performance Ratio | ||||||
| MVA spread ratio3 | ||||||
| Benchmarks | ||||||
| MVA Spread Ratio, Competitors4 | ||||||
| AbbVie Inc. | ||||||
| Amgen Inc. | ||||||
| Bristol-Myers Squibb Co. | ||||||
| Danaher Corp. | ||||||
| Eli Lilly & Co. | ||||||
| Gilead Sciences Inc. | ||||||
| Merck & Co. Inc. | ||||||
| Pfizer Inc. | ||||||
| Regeneron Pharmaceuticals Inc. | ||||||
| Thermo Fisher Scientific Inc. | ||||||
| Vertex Pharmaceuticals Inc. | ||||||
Based on: 10-K (reporting date: 2025-12-28), 10-K (reporting date: 2024-12-29), 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 declining trend from 2021 to 2023, followed by increases in both 2024 and 2025. Simultaneously, Invested Capital generally increased over the five-year period, though with a decrease observed between 2022 and 2023. The MVA spread ratio, reflecting the relationship between MVA and Invested Capital, demonstrated corresponding fluctuations.
- Market Value Added (MVA)
- MVA began at US$359,722 million in 2021, decreasing to US$306,339 million by 2023. A slight recovery was noted in 2024, reaching US$307,502 million, before a substantial increase to US$489,535 million in 2025. This suggests a period of value erosion followed by significant value creation towards the end of the analyzed period.
- Invested Capital
- Invested Capital increased from US$98,066 million in 2021 to US$113,818 million in 2022. A decrease was then observed in 2023, falling to US$99,118 million. Subsequent years saw further increases, reaching US$138,153 million in 2025. This indicates a pattern of capital investment, with a temporary reduction in 2023 potentially due to divestitures or capital reallocation.
- MVA Spread Ratio
- The MVA spread ratio, which indicates how much value is created per dollar of invested capital, decreased from 366.82% in 2021 to 288.40% in 2022. It experienced a slight increase to 309.06% in 2023, followed by a decrease to 288.70% in 2024. The ratio then rose significantly to 354.34% in 2025. This movement closely mirrors the trends in MVA and Invested Capital, with the substantial increase in 2025 suggesting improved efficiency in value creation relative to capital employed.
The interplay between MVA and Invested Capital, as reflected in the MVA spread ratio, suggests a period of declining returns on invested capital between 2021 and 2023, followed by a notable improvement in 2025. The substantial increase in MVA in 2025, coupled with the rising MVA spread ratio, indicates a positive shift in the company’s ability to generate value from its invested capital.
MVA Margin
Johnson & Johnson, MVA margin calculation, comparison to benchmarks
| Dec 28, 2025 | Dec 29, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Market value added (MVA)1 | ||||||
| Sales to customers | ||||||
| Performance Ratio | ||||||
| MVA margin2 | ||||||
| Benchmarks | ||||||
| MVA Margin, Competitors3 | ||||||
| AbbVie Inc. | ||||||
| Amgen Inc. | ||||||
| Bristol-Myers Squibb Co. | ||||||
| Danaher Corp. | ||||||
| Eli Lilly & Co. | ||||||
| Gilead Sciences Inc. | ||||||
| Merck & Co. Inc. | ||||||
| Pfizer Inc. | ||||||
| Regeneron Pharmaceuticals Inc. | ||||||
| Thermo Fisher Scientific Inc. | ||||||
| Vertex Pharmaceuticals Inc. | ||||||
Based on: 10-K (reporting date: 2025-12-28), 10-K (reporting date: 2024-12-29), 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 to customers
= 100 × ÷ =
3 Click competitor name to see calculations.
The Market Value Added (MVA) exhibited a fluctuating pattern over the five-year period. Initially, a decrease in MVA was observed from 2021 to 2023, followed by a slight increase in 2024, and a substantial rise in 2025. Concurrently, Sales to Customers demonstrated a more stable trajectory, with a dip in 2023 before recovering and exceeding 2021 levels by 2025. The MVA margin mirrored the MVA trend, showing volatility but ultimately reaching its highest point in the observed period in 2025.
- Market Value Added (MVA)
- The MVA began at US$359,722 million in 2021, declining to US$306,339 million by 2023. A modest recovery to US$307,502 million occurred in 2024, before a significant increase to US$489,535 million in 2025. This suggests a strengthening of investor perception of value creation in the most recent year.
- Sales to Customers
- Sales to Customers remained relatively consistent between 2021 and 2022, fluctuating around US$94 million. A decrease to US$85,159 million was noted in 2023, followed by a rebound to US$88,821 million in 2024 and further growth to US$94,193 million in 2025. This indicates a recovery in revenue generation towards the end of the period.
- MVA Margin
- The MVA margin decreased from 383.60% in 2021 to 345.74% in 2022, then increased to 359.73% in 2023. It experienced a slight decline to 346.20% in 2024, before a substantial increase to 519.72% in 2025. The significant increase in the MVA margin in 2025, coupled with the rise in MVA, suggests improved efficiency in generating value from sales.
The relationship between Sales to Customers and MVA appears to be complex. While sales decreased in 2023, MVA also decreased, but not proportionally. The substantial increase in MVA in 2025, alongside a return to prior sales levels, suggests factors beyond revenue growth are significantly influencing market valuation. Further investigation into cost structures, profitability, and investor sentiment would be beneficial to fully understand these dynamics.