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.
MVA
Kellanova, MVA calculation
US$ in millions
Based on: 10-K (reporting date: 2023-12-30), 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: 2019-12-28).
1 Fair value of debt. See details »
2 Invested capital. See details »
- Market (fair) value of Kellanova
- The market fair value demonstrated a fluctuating downward trend over the five-year period. Beginning at approximately $31.7 billion in 2019, it decreased slightly to around $29.97 billion in 2020, followed by a modest recovery to about $31.45 billion in 2021. However, this was followed by consecutive declines in 2022 and 2023, reaching approximately $30.94 billion and $25.75 billion respectively. The most notable drop occurred in the last year, indicating a significant reduction in perceived market valuation.
- Invested capital
- The invested capital displayed a generally stable but slightly declining pattern over the same timeframe. Starting at roughly $13.1 billion in 2019, it incrementally increased to a peak near $13.6 billion in 2021. Subsequently, invested capital diminished marginally in 2022 to about $13.19 billion and then more sharply to $11.68 billion in 2023. This decline suggests a reduction in the capital employed by the company in the most recent year, potentially reflecting strategic divestments or operational adjustments.
- Market value added (MVA)
- Market value added, reflecting the difference between market value and invested capital, followed a generally decreasing trajectory despite some fluctuations. Starting at approximately $18.6 billion in 2019, it reduced to about $16.78 billion in 2020, then increased slightly to $17.87 billion in 2021. Following this, it showed a minor decrease to $17.76 billion in 2022 before a more marked decline to $14.08 billion in 2023. This pattern suggests a diminishing premium that the market places on the company's invested capital over time, particularly acute in the latest year.
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MVA Spread Ratio
Kellanova, MVA spread ratio calculation, comparison to benchmarks
| Dec 30, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 28, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Market value added (MVA)1 | 14,078) | 17,756) | 17,867) | 16,778) | 18,603) | |
| Invested capital2 | 11,675) | 13,188) | 13,587) | 13,194) | 13,101) | |
| Performance Ratio | ||||||
| MVA spread ratio3 | 120.58% | 134.63% | 131.50% | 127.17% | 141.99% | |
| Benchmarks | ||||||
| MVA Spread Ratio, Competitors4 | ||||||
| Coca-Cola Co. | 258.44% | 267.55% | 289.24% | — | — | |
| Mondelēz International Inc. | 97.98% | 73.56% | 85.16% | — | — | |
| PepsiCo Inc. | 265.48% | 296.11% | 297.67% | — | — | |
| Philip Morris International Inc. | 265.23% | 327.97% | 585.34% | — | — | |
Based on: 10-K (reporting date: 2023-12-30), 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: 2019-12-28).
1 MVA. See details »
2 Invested capital. See details »
3 2023 Calculation
MVA spread ratio = 100 × MVA ÷ Invested capital
= 100 × 14,078 ÷ 11,675 = 120.58%
4 Click competitor name to see calculations.
The financial data reveals several key trends regarding market value added, invested capital, and the MVA spread ratio over a five-year period from 2019 to 2023.
- Market Value Added (MVA)
- The MVA peaked in 2019 at $18,603 million and then experienced a decline to $16,778 million in 2020. A slight recovery occurred in 2021, with MVA increasing to $17,867 million and remaining relatively stable in 2022 at $17,756 million. However, a notable decrease was observed in 2023, with MVA falling to $14,078 million, marking the lowest figure within the examined timeframe.
- Invested Capital
- Invested capital showed a gradual upward trend from 2019 ($13,101 million) to 2021 ($13,587 million), followed by a reduction in 2022 ($13,188 million) and a more pronounced decrease in 2023 ($11,675 million). This indicates a contraction in capital investment after 2021.
- MVA Spread Ratio
- The MVA spread ratio, representing the premium of market value added relative to invested capital, started at a high of 141.99% in 2019. It dropped significantly in 2020 to 127.17%, followed by modest fluctuations in 2021 (131.5%) and 2022 (134.63%). In 2023, the ratio declined to 120.58%, the lowest in the observed period, reflecting reduced market value creation relative to invested capital.
Overall, the data points to a peak in market value and capital efficiency in 2019, followed by a dip in 2020 coinciding with global economic disruptions. Although partial recovery was evident in the subsequent two years, the downward shift in 2023 in both MVA and MVA spread ratio, alongside decreasing invested capital, suggests a contraction phase and potential challenges in maintaining value creation in recent times.
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MVA Margin
Kellanova, MVA margin calculation, comparison to benchmarks
| Dec 30, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 28, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Market value added (MVA)1 | 14,078) | 17,756) | 17,867) | 16,778) | 18,603) | |
| Net sales | 13,122) | 15,315) | 14,181) | 13,770) | 13,578) | |
| Performance Ratio | ||||||
| MVA margin2 | 107.29% | 115.94% | 125.99% | 121.85% | 137.00% | |
| Benchmarks | ||||||
| MVA Margin, Competitors3 | ||||||
| Coca-Cola Co. | 471.88% | 497.46% | 600.94% | — | — | |
| Mondelēz International Inc. | 167.29% | 149.09% | 182.53% | — | — | |
| PepsiCo Inc. | 217.79% | 238.05% | 261.55% | — | — | |
| Philip Morris International Inc. | 387.28% | 489.05% | 543.41% | — | — | |
Based on: 10-K (reporting date: 2023-12-30), 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: 2019-12-28).
1 MVA. See details »
2 2023 Calculation
MVA margin = 100 × MVA ÷ Net sales
= 100 × 14,078 ÷ 13,122 = 107.29%
3 Click competitor name to see calculations.
- Market Value Added (MVA)
- The Market Value Added (MVA) demonstrated a declining trend over the observed period. Starting at 18,603 million USD in 2019, it decreased to 16,778 million USD in 2020, followed by a slight recovery to 17,867 million USD in 2021. However, the value remained relatively flat in 2022 at 17,756 million USD before experiencing a significant decline to 14,078 million USD in 2023. This overall downward movement suggests a diminishing market perception of the company's value addition over time, particularly notable in the recent year.
- Net Sales
- Net sales exhibited initial growth from 13,578 million USD in 2019 to 15,315 million USD in 2022, marking a steady increase each year. However, in 2023, net sales declined sharply to 13,122 million USD, falling below prior years' figures. This pattern indicates that while the company experienced sales growth for the first four years, the most recent period saw a notable reduction in revenue, potentially signaling operational or market challenges.
- MVA Margin
- The MVA margin, reflecting the ratio of market value added to net sales, followed a decreasing pattern throughout the period. The margin dropped from 137% in 2019 to 121.85% in 2020, then slightly increased to 125.99% in 2021. Subsequently, it declined again to 115.94% in 2022 and further to 107.29% in 2023. This declining margin trend suggests reduced efficiency or effectiveness in translating sales into market value added, with a consistent weakening observed over the five-year span.
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