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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Raytheon Co. pages available for free this week:
- Income Statement
- Statement of Comprehensive Income
- Balance Sheet: Assets
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Solvency Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Enterprise Value to FCFF (EV/FCFF)
- Present Value of Free Cash Flow to Equity (FCFE)
- Net Profit Margin since 2005
- Current Ratio since 2005
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MVA
Raytheon Co., 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 Raytheon
- The market value exhibited a generally upward trend over the five-year period. Starting at 44,331 million USD in 2015, it increased significantly to 51,789 million USD in 2016. The value peaked in 2017 at 68,048 million USD before experiencing a decline to 57,684 million USD in 2018. This was followed by a rebound to 70,263 million USD in 2019, reaching the highest level in the observed period.
- Invested capital
- Invested capital showed a steady but moderate increase over the same timeframe. Beginning at 22,413 million USD in 2015, it rose incrementally each year, reaching 23,509 million USD in 2016 and remaining almost flat in 2017 at 23,548 million USD. The upward trend continued with a more noticeable increase to 26,081 million USD in 2018 and slightly further to 26,688 million USD in 2019.
- Market value added (MVA)
- The Market Value Added demonstrated considerable fluctuations. It increased from 21,918 million USD in 2015 to 28,280 million USD in 2016, followed by a sharp rise to 44,500 million USD in 2017. However, there was a notable decline to 31,603 million USD in 2018. The MVA recovered in 2019, reaching 43,575 million USD, approaching the earlier peak observed in 2017.
- Overall analysis
- The data suggests that the company's market valuation has been robust with periods of volatility, particularly between 2017 and 2018. While invested capital grew steadily, the market value added was more volatile, closely mirroring the fluctuations in market value. This indicates that changes in perceived market worth outpaced changes in capital investment, reflecting shifts in investor sentiment or company performance expectations during the period analyzed.
MVA Spread Ratio
Raytheon Co., 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 | ||||||
| Boeing Co. | ||||||
| Caterpillar Inc. | ||||||
| Eaton Corp. plc | ||||||
| GE Aerospace | ||||||
| Honeywell International Inc. | ||||||
| Lockheed Martin Corp. | ||||||
| RTX 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 (MVA) demonstrated considerable fluctuations over the five-year period. Starting at 21,918 million USD in 2015, it rose sharply to reach a peak of 44,500 million USD in 2017. After a decline to 31,603 million USD in 2018, the MVA rebounded again to 43,575 million USD by the end of 2019. Overall, the MVA showed significant volatility but maintained an upward trend compared to the initial year.
- Invested Capital
- Invested capital exhibited a steady increase throughout the period. It grew gradually from 22,413 million USD in 2015 to 26,688 million USD in 2019. The growth was consistent year-over-year without substantial dips, indicating ongoing capital investment or retained assets.
- MVA Spread Ratio
- The MVA spread ratio, which measures the efficiency of capital value creation, mirrored the volatility seen in MVA with notable variability. Beginning at 97.79% in 2015, the ratio increased sharply to 188.97% in 2017, aligning with the peak in MVA. Despite a decrease to 121.17% in 2018, it again rose to 163.27% in 2019. This pattern suggests fluctuating but generally strong returns on invested capital relative to market value.
- Summary
- Collectively, the data indicate that despite some setbacks, there was overall positive growth in market value added and invested capital. The capital base expanded steadily, while the company showed periods of high value creation efficiency as reflected in the MVA spread ratio. The fluctuations in MVA and the ratio suggest sensitivity to external or internal factors impacting market valuation, but the recovery patterns highlight resilience and potential for sustained value generation.
MVA Margin
Raytheon Co., 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 | ||||||
| Net sales | ||||||
| Performance Ratio | ||||||
| MVA margin2 | ||||||
| Benchmarks | ||||||
| MVA Margin, Competitors3 | ||||||
| Boeing Co. | ||||||
| Caterpillar Inc. | ||||||
| Eaton Corp. plc | ||||||
| GE Aerospace | ||||||
| Honeywell International Inc. | ||||||
| Lockheed Martin Corp. | ||||||
| RTX 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 ÷ Net sales
= 100 × ÷ =
3 Click competitor name to see calculations.
- Market Value Added (MVA)
- The market value added exhibited a generally upward trend over the five-year period. Starting at 21,918 million US dollars in 2015, it increased to a peak of 44,500 million in 2017. Despite a decline in 2018 to 31,603 million, the figure recovered strongly in 2019, reaching 43,575 million. This pattern suggests fluctuations in market perceptions but an overall positive growth trajectory in shareholder value creation.
- Net Sales
- Net sales demonstrated consistent growth across the years. Beginning at 23,247 million US dollars in 2015, sales steadily increased each year, culminating at 29,176 million in 2019. This continuous increase reflects an expanding revenue base and possibly effective sales strategies or market demand growth during the period.
- MVA Margin
- The MVA margin showed marked variability, with values expressed as percentages. After starting at 94.28% in 2015, it rose sharply to 117.5% in 2016 and peaked dramatically at 175.55% in 2017. The margin then decreased to 116.8% in 2018 but climbed again in 2019 to 149.35%. These fluctuations indicate changes in the efficiency of converting net sales into market value added, suggesting cycles of profitability or investor expectations impacting the company’s market valuation relative to sales.