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: Liabilities and Stockholders’ Equity
- Analysis of Long-term (Investment) Activity Ratios
- Present Value of Free Cash Flow to Equity (FCFE)
- Selected Financial Data since 2010
- Operating Profit Margin since 2010
- Return on Equity (ROE) since 2010
- Debt to Equity since 2010
- Price to Earnings (P/E) since 2010
- Analysis of Revenues
- Analysis of Debt
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MVA
Kinder Morgan Inc., MVA calculation
US$ in millions
Based on: 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
1 Fair value of debt. See details »
2 Invested capital. See details »
- Market (fair) value of KMI
- The market value exhibited fluctuations over the five-year period. Beginning at 73,256 million USD in 2015, it experienced a significant increase to 92,171 million USD in 2016. Subsequently, a decline was observed in 2017, bringing the value down to 80,144 million USD. From 2017 onwards, the market value remained relatively stable with minor increases, reaching 80,462 million USD in 2018 and finally climbing to 87,968 million USD in 2019.
- Invested capital
- Invested capital showed a general downward trend throughout the period. Starting at 72,098 million USD in 2015, it decreased steadily each year, ending at 67,164 million USD in 2019. This decline indicates a reduction in the capital base invested in the company over the five years.
- Market value added (MVA)
- The market value added reflected considerable volatility during the analyzed period. MVA began at 1,158 million USD in 2015 and surged markedly to 22,532 million USD in 2016. However, it dropped significantly to 11,067 million USD in 2017 and remained relatively stable around 10,803 million USD in 2018. In 2019, MVA experienced another substantial increase, reaching 20,804 million USD, highlighting notable value creation in specific years.
MVA Spread Ratio
Kinder Morgan Inc., MVA spread ratio calculation, comparison to benchmarks
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Market value added (MVA)1 | ||||||
| Invested capital2 | ||||||
| Performance Ratio | ||||||
| MVA spread ratio3 | ||||||
| Benchmarks | ||||||
| MVA Spread Ratio, Competitors4 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
Based on: 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
1 MVA. See details »
2 Invested capital. See details »
3 2019 Calculation
MVA spread ratio = 100 × MVA ÷ Invested capital
= 100 × ÷ =
4 Click competitor name to see calculations.
- Market Value Added (MVA)
- The market value added experienced significant fluctuations over the reported periods. Starting from a relatively low value of 1,158 million US dollars at the end of 2015, it rose sharply to 22,532 million US dollars by the end of 2016. This was followed by a notable decline to 11,067 million US dollars in 2017 and a slight further decline to 10,803 million US dollars in 2018. The MVA rebounded considerably in 2019, reaching 20,804 million US dollars. This pattern indicates volatility in market perception or underlying business performance impacting market valuation.
- Invested Capital
- The invested capital showed a gradual declining trend over the five-year period. It started at 72,098 million US dollars in 2015 and decreased steadily to 67,164 million US dollars by 2019. The decline was consistent with minor fluctuations, suggesting a possible reduction in capital investment or asset base during this timeframe.
- MVA Spread Ratio
- The MVA spread ratio, which measures the spread between the return on invested capital and the cost of capital as reflected by market value added per unit of invested capital, mirrored the volatility observed in MVA. It increased sharply from 1.61% in 2015 to 32.36% in 2016, then halved to 16.02% in 2017 and remained fairly stable at 15.51% in 2018. The ratio surged again to 30.97% in 2019. These fluctuations point to changes in profitability relative to invested capital and market expectations over the analyzed period.
MVA Margin
Kinder Morgan Inc., MVA margin calculation, comparison to benchmarks
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Market value added (MVA)1 | ||||||
| Revenues | ||||||
| Performance Ratio | ||||||
| MVA margin2 | ||||||
| Benchmarks | ||||||
| MVA Margin, Competitors3 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
Based on: 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
1 MVA. See details »
2 2019 Calculation
MVA margin = 100 × MVA ÷ Revenues
= 100 × ÷ =
3 Click competitor name to see calculations.
- Analysis of Market Value Added (MVA)
- The Market Value Added (MVA) exhibited significant volatility over the five-year period. Starting at 1,158 million US dollars in 2015, MVA surged sharply to 22,532 million US dollars in 2016. Following this peak, the figure declined to 11,067 million in 2017 and then marginally decreased further to 10,803 million in 2018. In 2019, MVA rebounded notably to 20,804 million, indicating renewed investor value creation toward the end of the period.
- Analysis of Revenues
- Revenues showed a fluctuating but generally stable pattern during the same timeframe. Revenues started at 14,403 million US dollars in 2015, decreased to 13,058 million in 2016, then experienced moderate recovery to 13,705 million in 2017. The upward trend continued, reaching 14,144 million in 2018, before declining again to 13,209 million in 2019. The magnitude of variation in revenues was relatively modest compared to the changes in MVA.
- Analysis of MVA Margin
- The MVA margin demonstrated marked variability in line with changes in MVA and revenues. It was 8.04% in 2015, followed by a dramatic increase to 172.55% in 2016. Subsequently, the margin decreased to 80.75% in 2017 and further to 76.38% in 2018. In 2019, the margin rose sharply again to 157.5%. These fluctuations indicate significant shifts in value creation efficiency relative to revenues across the years.
- Summary of Trends and Insights
- The data reveals a pronounced decoupling between revenues and market value added over the analyzed period. While revenues exhibited relatively mild fluctuations within a narrow range, MVA and MVA margins experienced large swings, suggesting that factors beyond revenue growth influenced investor perceptions and value creation. The spikes in 2016 and 2019 in both MVA and MVA margin reflect episodes of heightened investor confidence or strategic developments potentially driving market valuation disproportionately higher than revenue changes. Conversely, the declines in the intervening years point to periods of subdued market valuation despite relatively stable revenue figures. This pattern highlights the sensitivity of market value metrics to external factors, operational efficiencies, or profitability improvements not directly discernible from revenue trends alone.