Stock Analysis on Net

Mastercard Inc. (NYSE:MA)

Enterprise Value to FCFF (EV/FCFF)

Microsoft Excel LibreOffice Calc

Free Cash Flow to The Firm (FCFF)

Mastercard Inc., FCFF calculation

US$ in millions

Microsoft Excel LibreOffice Calc
12 months ended: Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Net income 6,411  8,118  5,859  3,915  4,059 
Net noncash charges 1,963  1,763  1,677  1,926  1,292 
Changes in operating assets and liabilities (1,150) (1,698) (1,313) (286) (867)
Net cash provided by operating activities 7,224  8,183  6,223  5,555  4,484 
Cash paid for interest, net of tax1 257  165  125  97  53 
Purchases of property and equipment (339) (422) (330) (300) (215)
Capitalized software (369) (306) (174) (123) (167)
Free cash flow to the firm (FCFF) 6,773  7,620  5,844  5,229  4,155 

Based on: 10-K (reporting date: 2020-12-31), 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).

Item Description The company
FCFF Free cash flow to the firm is the cash flow available to the Mastercard Inc. suppliers of capital after all operating expenses have been paid and necessary investments in working and fixed capital have been made. Mastercard Inc. FCFF increased from 2018 to 2019 but then slightly decreased from 2019 to 2020.

Interest Paid, Net of Tax

Mastercard Inc., interest paid, net of tax calculation

US$ in millions

Microsoft Excel LibreOffice Calc
12 months ended: Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Effective Income Tax Rate (EITR)
EITR1 17.40% 16.90% 18.50% 28.00% 28.10%
Interest Paid, Net of Tax
Cash paid for interest, before tax 311  199  153  135  74 
Less: Cash paid for interest, tax2 54  34  28  38  21 
Cash paid for interest, net of tax 257  165  125  97  53 

Based on: 10-K (reporting date: 2020-12-31), 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).

1 See details »

2 2020 Calculation
Cash paid for interest, tax = Cash paid for interest × EITR
= 311 × 17.40% = 54


Enterprise Value to FCFF Ratio, Current

Mastercard Inc., current EV/FCFF calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Selected Financial Data (US$ in millions)
Enterprise value (EV) 365,540 
Free cash flow to the firm (FCFF) 6,773 
Valuation Ratio
EV/FCFF 53.97
Benchmarks
EV/FCFF, Competitors1
Accenture PLC 25.64
Adobe Inc. 45.71
Autodesk Inc. 40.82
Automatic Data Processing Inc. 23.56
Fidelity National Information Services Inc. 24.17
Fiserv Inc. 24.31
International Business Machines Corp. 10.10
Intuit Inc. 48.94
Microsoft Corp. 41.60
Oracle Corp. 17.41
PayPal Holdings Inc. 32.69
salesforce.com inc. 52.46
ServiceNow Inc. 75.52
Visa Inc. 30.30
EV/FCFF, Sector
Software & Services 38.64
EV/FCFF, Industry
Information Technology 36.83

Based on: 10-K (reporting date: 2020-12-31).

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

Mastercard Inc., historical EV/FCFF calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Selected Financial Data (US$ in millions)
Enterprise value (EV)1 338,628  341,613  222,600  177,425  113,544 
Free cash flow to the firm (FCFF)2 6,773  7,620  5,844  5,229  4,155 
Valuation Ratio
EV/FCFF3 50.00 44.83 38.09 33.93 27.33
Benchmarks
EV/FCFF, Competitors4
Accenture PLC 17.90 18.49 17.18 19.43 17.12
Adobe Inc. 40.43 40.48 31.36 33.45 25.29
Autodesk Inc. 23.35 98.38 144.92 33.22
Automatic Data Processing Inc. 12.58 19.68 14.87 12.54 3.92
Fidelity National Information Services Inc. 27.38 61.52 26.15 29.85 23.87
Fiserv Inc. 25.67 41.67 29.37 26.01 23.48
International Business Machines Corp. 9.35 12.86 12.27 12.20 14.18
Intuit Inc. 37.90 33.30 27.69 25.66 31.97
Microsoft Corp. 33.99 26.37 23.99 15.60 14.63
Oracle Corp. 14.99 14.03 11.11 15.07 11.24
PayPal Holdings Inc. 52.80 28.53 16.81 36.26 12.05
salesforce.com inc. 39.63 41.21 40.68 33.77 35.29
ServiceNow Inc. 82.97 71.37 71.10 52.84 246.84
Visa Inc. 44.35 31.67 25.49 29.33 37.15
EV/FCFF, Sector
Software & Services 30.27 26.96 22.48 19.77 17.38
EV/FCFF, Industry
Information Technology 25.92 21.80 18.35 18.39 15.24

Based on: 10-K (reporting date: 2020-12-31), 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).

1 See details »

2 See details »

3 2020 Calculation
EV/FCFF = EV ÷ FCFF
= 338,628 ÷ 6,773 = 50.00

4 Click competitor name to see calculations.

Valuation ratio Description The company
EV/FCFF Enterprise value to free cash flow to the firm is whole company valuation indicator. Mastercard Inc. EV/FCFF ratio increased from 2018 to 2019 and from 2019 to 2020.