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.
Paying user area
Try for free
Merck & Co. Inc. pages available for free this week:
- Statement of Comprehensive Income
- Balance Sheet: Liabilities and Stockholders’ Equity
- Common-Size Income Statement
- Analysis of Profitability Ratios
- Analysis of Long-term (Investment) Activity Ratios
- Analysis of Geographic Areas
- Present Value of Free Cash Flow to Equity (FCFE)
- Current Ratio since 2005
- Debt to Equity since 2005
- Analysis of Debt
The data is hidden behind: . Unhide it.
Get full access to the entire website from $10.42/mo, or
get 1-month access to Merck & Co. Inc. for $24.99.
This is a one-time payment. There is no automatic renewal.
We accept:
MVA
Merck & Co. Inc., MVA calculation
US$ in millions
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Fair value of debt. See details »
2 Invested capital. See details »
- Market (fair) value of Merck
- The market value exhibited an overall growth trend from 2020 through 2023, rising from approximately 224.7 billion US dollars to a peak of 358.5 billion US dollars. However, in 2024, there was a notable decline to 263.3 billion US dollars, representing a significant decrease from the previous year but still maintaining a value above the 2020 and 2021 levels.
- Invested capital
- The invested capital increased steadily over the five-year period, starting at 57.2 billion US dollars in 2020 and rising to 79.4 billion US dollars by 2024. There was a period of moderate growth with slight fluctuations between 2022 and 2023, where invested capital slightly decreased from 73.9 billion to 70.0 billion US dollars before rising again in 2024.
- Market value added (MVA)
- The MVA experienced significant growth between 2020 and 2023, increasing from 167.5 billion US dollars to a high of 288.5 billion US dollars, paralleling the rise in market value during this period. Similar to the market value trend, MVA sharply declined in 2024 to 183.9 billion US dollars, indicating reduced market value creation relative to invested capital compared to the previous year, yet still maintaining a value higher than the starting point in 2020.
- Summary of trends
- The data indicates that the company saw substantial growth in market valuation and value creation from 2020 through 2023, while invested capital steadily increased, reflecting ongoing investment and expansion. However, the sharp declines in both market value and MVA in 2024 suggest a period of reduced market confidence or valuation adjustment despite continued capital investment. This divergence between increasing invested capital and decreasing market value components in the final year may warrant further investigation into factors impacting market perception or operational performance during that period.
MVA Spread Ratio
Merck & Co. Inc., MVA spread ratio calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| 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. | ||||||
| Johnson & Johnson | ||||||
| Pfizer Inc. | ||||||
| Regeneron Pharmaceuticals Inc. | ||||||
| Thermo Fisher Scientific Inc. | ||||||
| Vertex Pharmaceuticals Inc. | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 MVA. See details »
2 Invested capital. See details »
3 2024 Calculation
MVA spread ratio = 100 × MVA ÷ Invested capital
= 100 × ÷ =
4 Click competitor name to see calculations.
- Market Value Added (MVA)
- The Market Value Added shows a fluctuating pattern over the observed period. Initially, there is a decrease from 167,503 million USD in 2020 to 157,751 million USD in 2021. This is followed by a significant increase to 231,232 million USD in 2022 and a further rise to 288,506 million USD in 2023. However, in 2024, the MVA declines sharply to 183,891 million USD, indicating volatility in market value creation during the period.
- Invested Capital
- Invested Capital exhibits a generally increasing trend with some variability. Starting at 57,182 million USD in 2020, it increases substantially to 70,735 million USD in 2021 and continues to rise to 73,942 million USD in 2022. A slight reduction is observed in 2023, where invested capital decreases to 69,966 million USD, followed by a rebound to 79,426 million USD in 2024. This suggests ongoing capital reinvestment efforts with some potential strategic adjustments in 2023.
- MVA Spread Ratio (%)
- The MVA Spread Ratio, which reflects the value created relative to invested capital, shows considerable variation. It starts high at 292.93% in 2020, decreases to 223.02% in 2021, then rises sharply to 312.72% in 2022 and reaches its peak at 412.35% in 2023. In 2024, the ratio falls significantly to 231.53%. The trend indicates fluctuating efficiency in value generation relative to invested capital, peaking in 2023 before declining.
- Overall Trend Analysis
- The financial data reveal that despite increasing invested capital over the years, the company's ability to create market value as measured by MVA and MVA spread ratio has been inconsistent. The peak performance year appears to be 2023, with the highest market value added and MVA spread ratio. However, the subsequent year exhibits a contraction, suggesting possible challenges or changes in market perception or operational efficiency. The variability in these metrics highlights the importance of continuous evaluation of capital deployment and value generation strategies.
MVA Margin
Merck & Co. Inc., MVA margin calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Market value added (MVA)1 | ||||||
| Sales | ||||||
| Performance Ratio | ||||||
| MVA margin2 | ||||||
| Benchmarks | ||||||
| MVA Margin, Competitors3 | ||||||
| AbbVie Inc. | ||||||
| Amgen Inc. | ||||||
| Bristol-Myers Squibb Co. | ||||||
| Danaher Corp. | ||||||
| Eli Lilly & Co. | ||||||
| Gilead Sciences Inc. | ||||||
| Johnson & Johnson | ||||||
| Pfizer Inc. | ||||||
| Regeneron Pharmaceuticals Inc. | ||||||
| Thermo Fisher Scientific Inc. | ||||||
| Vertex Pharmaceuticals Inc. | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 MVA. See details »
2 2024 Calculation
MVA margin = 100 × MVA ÷ Sales
= 100 × ÷ =
3 Click competitor name to see calculations.
The financial data reveals notable fluctuations and trends in the company's market value added (MVA), sales, and MVA margin over the five-year period ending in 2024.
- Market Value Added (MVA)
- Initially, from 2020 to 2021, the MVA decreased from 167,503 million to 157,751 million US dollars, indicating a decline in the company's value creation during that timeframe. Subsequently, there was a marked recovery and growth, with MVA substantially rising to 231,232 million in 2022 and further increasing to a peak of 288,506 million in 2023. However, in 2024, there was a significant decline to 183,891 million, suggesting a reversal of the earlier upward momentum.
- Sales
- Sales demonstrated a generally upward trend throughout the period, albeit with varying rates of growth. Starting at 47,994 million US dollars in 2020, sales increased marginally in 2021 to 48,704 million. A more substantial increase occurred in 2022, reaching 59,283 million. Modest growth continued through 2023 with sales at 60,115 million and 64,168 million in 2024, reflecting steady expansion of revenue streams.
- MVA Margin
- The MVA margin, which measures the efficiency of value creation relative to sales, exhibited considerable volatility. The margin decreased from 349.01% in 2020 to 323.9% in 2021, aligning with the initial drop in MVA. It then increased significantly to 390.05% in 2022 and reached a peak of 479.92% in 2023, suggesting heightened profitability or value generation relative to sales. However, this was followed by a pronounced decrease to 286.58% in 2024, paralleling the fall in MVA and indicating reduced effectiveness in converting sales into market value.
Overall, the period was characterized by strong sales growth and a corresponding increase in value creation through 2023. The decline in both MVA and MVA margin in 2024 may warrant further investigation into underlying factors affecting the company's market value despite continued sales growth.