Stock Analysis on Net

Mastercard Inc. (NYSE:MA)

Price to FCFE (P/FCFE)

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Free Cash Flow to Equity (FCFE)

Mastercard Inc., FCFE calculation

US$ in millions

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12 months ended: Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Net income 8,687  6,411  8,118  5,859  3,915 
Net noncash charges 1,692  1,963  1,763  1,677  1,926 
Changes in operating assets and liabilities (916) (1,150) (1,698) (1,313) (286)
Net cash provided by operating activities 9,463  7,224  8,183  6,223  5,555 
Purchases of property and equipment (407) (339) (422) (330) (300)
Capitalized software (407) (369) (306) (174) (123)
Proceeds from debt, net 2,024  3,959  2,724  991  — 
Payment of debt (650) —  (500) —  (64)
Free cash flow to equity (FCFE) 10,023  10,475  9,679  6,710  5,068 

Based on: 10-K (reporting date: 2021-12-31), 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).

Item Description The company
FCFE Free cash flow to equity is the cash flow available to Mastercard Inc. equity holders after all operating expenses, interest, and principal payments have been paid and necessary investments in working and fixed capital have been made. Mastercard Inc. FCFE increased from 2019 to 2020 but then slightly decreased from 2020 to 2021 not reaching 2019 level.

Price to FCFE Ratio, Current

Mastercard Inc., current P/FCFE calculation, comparison to benchmarks

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No. shares of common stock outstanding 972,644,723
Selected Financial Data (US$)
Free cash flow to equity (FCFE) (in millions) 10,023 
FCFE per share 10.30
Current share price (P) 318.29
Valuation Ratio
P/FCFE 30.89
Benchmarks
P/FCFE, Competitors1
Accenture PLC 21.42
Adobe Inc. 25.10
Automatic Data Processing Inc. 25.00
International Business Machines Corp. 55.48
Intuit Inc. 60.98
Microsoft Corp. 37.90
Oracle Corp.
PayPal Holdings Inc. 15.55
Salesforce Inc. 14.42
ServiceNow Inc. 54.70
Visa Inc. 35.82
P/FCFE, Sector
Software & Services 29.13
P/FCFE, Industry
Information Technology 24.42

Based on: 10-K (reporting date: 2021-12-31).

1 Click competitor name to see calculations.

If the company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.
Otherwise, if the company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.


Price to FCFE Ratio, Historical

Mastercard Inc., historical P/FCFE calculation, comparison to benchmarks

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Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
No. shares of common stock outstanding1 977,476,439 993,362,338 1,005,108,964 1,025,909,048 1,051,384,936
Selected Financial Data (US$)
Free cash flow to equity (FCFE) (in millions)2 10,023  10,475  9,679  6,710  5,068 
FCFE per share3 10.25 10.54 9.63 6.54 4.82
Share price1, 4 369.77 341.00 340.95 220.54 172.52
Valuation Ratio
P/FCFE5 36.06 32.34 35.41 33.72 35.79
Benchmarks
P/FCFE, Competitors6
Accenture PLC 25.76 19.01 19.50 18.11 20.24
Adobe Inc. 34.26 41.36 41.90 19.87 35.56
Automatic Data Processing Inc. 25.07 26.84 30.56 28.87 29.94
International Business Machines Corp. 48.45 9.43 4.39 11.07 8.55
Intuit Inc. 86.74 17.36 34.61 29.29 42.22
Microsoft Corp. 42.54 42.74 30.77 37.57 8.86
Oracle Corp. 8.36 6.27 22.31 10.78 8.16
PayPal Holdings Inc. 27.08 34.78 20.59 18.96 33.80
Salesforce Inc. 49.52 50.40 29.09 52.51 25.44
ServiceNow Inc. 64.80 50.12 74.57 327.16 24.90
Visa Inc. 37.21 26.18 32.21 30.19 22.70
P/FCFE, Sector
Software & Services 33.45 27.09 23.93 25.04 13.05
P/FCFE, Industry
Information Technology 27.76 24.22 20.35 22.23 12.14

Based on: 10-K (reporting date: 2021-12-31), 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).

1 Data adjusted for splits and stock dividends.

2 See details »

3 2021 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= 10,023,000,000 ÷ 977,476,439 = 10.25

4 Closing price as at the filing date of Mastercard Inc. Annual Report.

5 2021 Calculation
P/FCFE = Share price ÷ FCFE per share
= 369.77 ÷ 10.25 = 36.06

6 Click competitor name to see calculations.

Valuation ratio Description The company
P/FCFE Price to free cash flow to equity is cash valuation indicator of stockholders’ equity. Mastercard Inc. P/FCFE ratio decreased from 2019 to 2020 but then increased from 2020 to 2021 exceeding 2019 level.