Enterprise Value to FCFF (EV/FCFF)
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- Income Statement
- Balance Sheet: Assets
- Balance Sheet: Liabilities and Stockholders’ Equity
- Common-Size Balance Sheet: Assets
- Analysis of Solvency Ratios
- Analysis of Short-term (Operating) Activity Ratios
- Capital Asset Pricing Model (CAPM)
- Return on Assets (ROA) since 2005
- Debt to Equity since 2005
- Price to Book Value (P/BV) since 2005
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Free Cash Flow to The Firm (FCFF)
Sherwin-Williams Co., FCFF calculation
US$ in thousands
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, 2 See details »
The financial data over the five-year period reveals fluctuations in the cash flow generation capacity of the organization.
- Net Operating Cash
- This metric starts at 3,408,600 thousand US dollars at the end of 2020. It then experiences a decline through 2021 and 2022, reaching a low of 1,919,900 thousand US dollars in 2022. Subsequently, there is a strong recovery in 2023 with an increase to 3,521,900 thousand US dollars, before slightly retracting to 3,153,200 thousand US dollars in 2024. This pattern indicates a volatility in operating cash generation, with notable improvement after a downturn in the middle of the period.
- Free Cash Flow to the Firm (FCFF)
- Similar to net operating cash, FCFF begins at 3,379,485 thousand US dollars at the end of 2020 and declines noticeably through 2021 and 2022, hitting a trough of 1,566,714 thousand US dollars in 2022. It then rebounds substantially in 2023 to 2,976,950 thousand US dollars, before falling again in 2024 to 2,445,671 thousand US dollars. The free cash flow shows a sharper decrease and less pronounced recovery compared to net operating cash, signifying possible variations in capital expenditures, investments, or working capital changes during the period.
Overall, both net operating cash and free cash flow to the firm exhibit a downward trend until 2022, followed by a recovery in 2023 and a modest decline in 2024. The trends suggest the company faced cash flow challenges in the middle of the observed timeframe but took steps to improve liquidity afterwards. The differences in the magnitude of recovery between the two cash flow measures may point to changes in non-operating cash activities or capital spending patterns.
Interest Paid, Net of Tax
Sherwin-Williams Co., interest paid, net of tax calculation
US$ in thousands
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).
2 2024 Calculation
Interest paid, tax = Interest paid × EITR
= × =
3 2024 Calculation
Capitalized interest, tax = Capitalized interest × EITR
= × =
The analysis of financial metrics over the five-year period reveals several notable trends.
- Effective income tax rate (EITR) (%)
- The effective income tax rate has shown variability across the years. It began at 19.4% in 2020, decreased to 17.1% in 2021, before increasing to 21.5% in 2022. This upward trend continued moderately with rates of 23.2% in 2023 and a slight decrease to 22.3% in 2024. Overall, the rate moved from a lower level in 2021 towards a higher bracket by 2024, indicating potential changes in tax policies or earnings composition affecting taxable income.
- Interest paid, net of tax (US$ in thousands)
- The amount of interest paid net of tax has consistently increased over the observed period from $274,685 thousand in 2020 to $316,161 thousand in 2024. The growth appears steady with yearly increments, except for a small decline in 2024 compared to 2023 when it was $319,872 thousand. This trend may reflect increased borrowing or changes in interest rates over the years.
- Capitalized interest, net of tax (US$ in thousands)
- Data on capitalized interest is only available for the last two years. It shows a notable rise from $23,578 thousand in 2023 to $46,309 thousand in 2024, nearly doubling. This suggests an increased allocation of interest costs to capital projects or assets, which may impact future depreciation and asset base expansion.
Enterprise Value to FCFF Ratio, Current
Sherwin-Williams Co., current EV/FCFF calculation, comparison to benchmarks
| Selected Financial Data (US$ in thousands) | |
| Enterprise value (EV) | |
| Free cash flow to the firm (FCFF) | |
| Valuation Ratio | |
| EV/FCFF | |
| Benchmarks | |
| EV/FCFF, Competitors1 | |
| Linde plc | |
| EV/FCFF, Sector | |
| Chemicals | |
| EV/FCFF, Industry | |
| Materials | |
Based on: 10-K (reporting date: 2024-12-31).
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
Sherwin-Williams Co., historical EV/FCFF calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Enterprise value (EV)1 | ||||||
| Free cash flow to the firm (FCFF)2 | ||||||
| Valuation Ratio | ||||||
| EV/FCFF3 | ||||||
| Benchmarks | ||||||
| EV/FCFF, Competitors4 | ||||||
| Linde plc | ||||||
| EV/FCFF, Sector | ||||||
| Chemicals | ||||||
| EV/FCFF, Industry | ||||||
| Materials | ||||||
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).
3 2024 Calculation
EV/FCFF = EV ÷ FCFF
= ÷ =
4 Click competitor name to see calculations.
The data reveals notable fluctuations in the company's enterprise value (EV), free cash flow to the firm (FCFF), and the EV to FCFF ratio over the five-year period.
- Enterprise Value (EV)
- The enterprise value shows an overall upward trend, rising from approximately US$72.3 billion at the end of 2020 to about US$97.8 billion at the end of 2024. There was an initial increase from 2020 to 2021, followed by a significant decline in 2022. Subsequently, the EV recovered sharply in 2023 and continued to grow through 2024, reaching its highest point in the dataset.
- Free Cash Flow to the Firm (FCFF)
- The FCFF exhibits variability and an overall declining tendency throughout the same period. Starting from approximately US$3.38 billion in 2020, the FCFF dropped substantially to about US$2.15 billion in 2021 and further decreased to US$1.57 billion in 2022. There was a recovery in 2023 to nearly US$3.0 billion, followed by a decline again in 2024 to approximately US$2.45 billion. These fluctuations indicate inconsistent cash generation from firm operations.
- EV to FCFF Ratio (EV/FCFF)
- The EV/FCFF ratio reflects significant volatility, correlating inversely to FCFF movements and partially to EV changes. The ratio was lowest in 2020 at 21.39, increased sharply to 36.7 in 2021, and peaked in 2022 at 43.34, reflecting diminished cash flow relative to enterprise value. It then decreased notably in 2023 to 29.82 due to FCFF recovery and EV growth, before rising again in 2024 to 40.01. The high ratio levels suggest increasing valuation multiples or reduced cash flow efficiency in some years.
In summary, while enterprise value generally increased over the period, free cash flow experienced considerable volatility and an overall decline, leading to pronounced fluctuations in the EV to FCFF ratio. This pattern may indicate periods of valuation expansion alongside variability in operating cash generation effectiveness.