Enterprise Value to FCFF (EV/FCFF)
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- Cash Flow Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Reportable Segments
- Analysis of Geographic Areas
- Enterprise Value (EV)
- Net Profit Margin since 2005
- Total Asset Turnover since 2005
- Price to Earnings (P/E) since 2005
- Analysis of Revenues
- Analysis of Debt
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Free Cash Flow to The Firm (FCFF)
United Parcel Service Inc., FCFF 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, 2 See details »
The analysis of the financial data over the five-year period reveals distinct trends in cash flow metrics. Net cash from operating activities experienced an overall increase from 2020 to 2021, peaking at 15,007 million US dollars, followed by a steady decline through 2024, where it settled at 10,122 million US dollars. This indicates a strengthening in operational cash generation in 2021, but a subsequent reduction towards the latter years.
Free cash flow to the firm (FCFF) shows a more volatile pattern. Starting at 5,613 million US dollars in 2020, FCFF almost doubled to 11,400 million in 2021, reflecting enhanced cash availability potentially for investment, debt repayment, or dividends. However, a decline occurs in 2022 and 2023, reaching the lowest value of 5,768 million in 2023, followed by a moderate increase in 2024 to 6,971 million. The fluctuations in FCFF suggest variability in investment activities, capital expenditures, or changes in working capital during this period.
- Net Cash from Operating Activities
- Increased significantly in 2021, then declined steadily from 2022 through 2024.
- Free Cash Flow to the Firm (FCFF)
- Marked by strong growth in 2021, a subsequent sharp decrease by 2023, and a partial recovery in 2024.
Overall, the data suggest an improvement in operational cash generation early in the period, followed by challenges or strategic decisions impacting cash flows in later years. The disparity between operating cash flow and FCFF in the later years may point to increased capital investments or other cash-consuming activities affecting free cash flow despite relatively stable operating cash generation.
Interest Paid, Net of Tax
United Parcel Service Inc., interest paid, net of tax 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).
2 2024 Calculation
Cash paid during the period for interest, net of amount capitalized, tax = Cash paid during the period for interest, net of amount capitalized × EITR
= × =
3 2024 Calculation
Capitalized interest, tax = Capitalized interest × EITR
= × =
The analysis of the financial data reveals several notable trends over the five-year period from 2020 to 2024.
- Effective Income Tax Rate (EITR)
- The effective income tax rate exhibits a consistent downward trend from 27.2% in 2020 to a low of 21.8% in 2023, followed by a slight increase to 22.3% in 2024. This overall decline suggests an improvement in tax efficiency or changes in tax regulations or tax planning strategies that yielded a lower tax burden over the majority of the period.
- Cash Paid During the Period for Interest, Net of Amount Capitalized, Net of Tax
- The interest cash outflow shows a steady year-over-year increase from $503 million in 2020 to $664 million in 2024. This upward trajectory indicates either increasing debt levels, higher interest rates, or both, which could imply rising financing costs. The consistent increase suggests that the company’s interest expenses are becoming a progressively more significant cash outflow.
- Capitalized Interest, Net of Tax
- Capitalized interest fluctuates without a clear linear pattern but shows an increase overall from $63 million in 2020 to $94 million in 2024. The notable jump in 2023 to $92 million indicates an increased level of investments in capital projects where interest costs are being capitalized rather than expensed immediately. This could reflect intensified capital expenditure or expansion activities during that period.
In summary, the data points to improved tax efficiency alongside rising cash interest payments and increased capitalized interest, highlighting changes in the company’s financing and investment activities. These factors likely have implications for the company’s cash flow management and long-term asset base development.
Enterprise Value to FCFF Ratio, Current
United Parcel Service Inc., current EV/FCFF calculation, comparison to benchmarks
| Selected Financial Data (US$ in millions) | |
| Enterprise value (EV) | |
| Free cash flow to the firm (FCFF) | |
| Valuation Ratio | |
| EV/FCFF | |
| Benchmarks | |
| EV/FCFF, Competitors1 | |
| FedEx Corp. | |
| Uber Technologies Inc. | |
| Union Pacific Corp. | |
| United Airlines Holdings Inc. | |
| EV/FCFF, Sector | |
| Transportation | |
| EV/FCFF, Industry | |
| Industrials | |
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
United Parcel Service Inc., 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 millions) | ||||||
| Enterprise value (EV)1 | ||||||
| Free cash flow to the firm (FCFF)2 | ||||||
| Valuation Ratio | ||||||
| EV/FCFF3 | ||||||
| Benchmarks | ||||||
| EV/FCFF, Competitors4 | ||||||
| FedEx Corp. | ||||||
| Uber Technologies Inc. | ||||||
| Union Pacific Corp. | ||||||
| United Airlines Holdings Inc. | ||||||
| EV/FCFF, Sector | ||||||
| Transportation | ||||||
| EV/FCFF, Industry | ||||||
| Industrials | ||||||
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.
- Enterprise Value (EV)
- The enterprise value demonstrated a non-linear downward trend over the five-year period. It increased from 158,463 million US dollars in 2020 to a peak of 193,224 million in 2021, followed by a decline to 165,335 million in 2022, continuing downward to 142,938 million in 2023, and reaching 113,580 million in 2024. This indicates a reduction in the overall market valuation of the firm after a brief increase in the second year.
- Free Cash Flow to the Firm (FCFF)
- Free cash flow to the firm rose significantly from 5,613 million US dollars in 2020 to 11,400 million in 2021, marking a strong increase. It then slightly decreased to 9,943 million in 2022 and fell substantially to 5,768 million in 2023. In 2024, FCFF rose again to 6,971 million but remained below the peak values observed in 2021 and 2022. This shows volatility in cash generation capability, with a peak early in the period and a notable dip in the third year.
- Enterprise Value to Free Cash Flow to the Firm (EV/FCFF) Ratio
- The EV/FCFF ratio, which reflects valuation in relation to free cash flow, decreased from a high of 28.23 in 2020 to lower values in 2021 (16.95) and 2022 (16.63), suggesting an improving valuation relative to free cash flow during that time. However, this ratio increased again to 24.78 in 2023, indicating a less favorable valuation relative to cash flow, before declining to 16.29 in 2024. The fluctuations in this ratio correspond to the changes in both EV and FCFF, reflecting adjustments in market perceptions of the firm's cash-generating ability and overall worth.