Applied Materials Inc., FCFF calculation

US$ in millions

12 months ended:	Oct 29, 2023	Oct 30, 2022	Oct 31, 2021	Oct 25, 2020	Oct 27, 2019	Oct 28, 2018
Net income	6,856)	6,525)	5,888)	3,619)	2,706)	3,313)
Net noncash charges	1,069)	666)	898)	823)	656)	813)
Changes in operating assets and liabilities, net of amounts acquired	775)	(1,792)	(1,344)	(638)	(115)	(339)
Cash provided by operating activities	8,700)	5,399)	5,442)	3,804)	3,247)	3,787)
Cash payments for interest, net of tax¹	182)	176)	178)	190)	181)	207)
Capital expenditures	(1,106)	(787)	(668)	(422)	(441)	(622)
Right-of-use assets obtained in exchange for finance lease liabilities	(109)	—)	—)	—)	—)	—)
Free cash flow to the firm (FCFF)	7,667)	4,788)	4,952)	3,572)	2,987)	3,372)

Based on: 10-K (reporting date: 2023-10-29), 10-K (reporting date: 2022-10-30), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-25), 10-K (reporting date: 2019-10-27), 10-K (reporting date: 2018-10-28).

¹ See details »

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Item	Description	The company
FCFF	Free cash flow to the firm is the cash flow available to the Applied Materials Inc. suppliers of capital after all operating expenses have been paid and necessary investments in working and fixed capital have been made.	Applied Materials Inc. FCFF decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.

Applied Materials Inc., interest paid, net of tax calculation

US$ in millions

12 months ended:	Oct 29, 2023	Oct 30, 2022	Oct 31, 2021	Oct 25, 2020	Oct 27, 2019	Oct 28, 2018
Effective Income Tax Rate (EITR)
EITR¹	11.10%	14.10%	13.00%	13.10%	17.20%	5.70%
Interest Paid, Net of Tax
Cash payments for interest, before tax	205)	205)	205)	219)	219)	219)
Less: Cash payments for interest, tax²	23)	29)	27)	29)	38)	12)
Cash payments for interest, net of tax	182)	176)	178)	190)	181)	207)

Based on: 10-K (reporting date: 2023-10-29), 10-K (reporting date: 2022-10-30), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-25), 10-K (reporting date: 2019-10-27), 10-K (reporting date: 2018-10-28).

¹ See details »

² 2023 Calculation
Cash payments for interest, tax = Cash payments for interest × EITR
= 205 × 11.10% = 23

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Applied Materials Inc., current EV/FCFF calculation, comparison to benchmarks

Selected Financial Data (US$ in millions)
Enterprise value (EV)	139,347)
Free cash flow to the firm (FCFF)	7,667)
Valuation Ratio
EV/FCFF	18.17
Benchmarks
EV/FCFF, Competitors¹
Advanced Micro Devices Inc.	185.28
Analog Devices Inc.	29.57
Broadcom Inc.	41.37
First Solar Inc.	—
Intel Corp.	—
KLA Corp.	25.88
Lam Research Corp.	21.35
Micron Technology Inc.	195.82
NVIDIA Corp.	130.55
Qualcomm Inc.	14.51
Texas Instruments Inc.	112.48
EV/FCFF, Sector
Semiconductors & Semiconductor Equipment	147.98
EV/FCFF, Industry
Information Technology	52.67

Based on: 10-K (reporting date: 2023-10-29).

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.

Applied Materials Inc., historical EV/FCFF calculation, comparison to benchmarks

	Oct 29, 2023	Oct 30, 2022	Oct 31, 2021	Oct 25, 2020	Oct 27, 2019	Oct 28, 2018
Selected Financial Data (US$ in millions)
Enterprise value (EV)¹	133,385)	91,283)	129,849)	80,447)	56,494)	33,594)
Free cash flow to the firm (FCFF)²	7,667)	4,788)	4,952)	3,572)	2,987)	3,372)
Valuation Ratio
EV/FCFF³	17.40	19.06	26.22	22.52	18.91	9.96
Benchmarks
EV/FCFF, Competitors⁴
Advanced Micro Devices Inc.	225.41	38.82	43.41	126.98	169.58	—
Analog Devices Inc.	25.61	23.12	39.16	27.12	21.68	16.04
Broadcom Inc.	28.53	14.74	19.47	16.54	15.04	13.02
First Solar Inc.	—	—	—	—	—	—
Intel Corp.	—	—	16.94	11.08	17.39	—
KLA Corp.	19.99	19.05	26.29	18.70	20.92	—
Lam Research Corp.	17.99	24.08	24.40	26.78	10.44	—
Micron Technology Inc.	—	16.58	28.79	188.88	13.85	—
NVIDIA Corp.	142.92	78.06	69.50	41.66	27.89	—
Qualcomm Inc.	11.61	18.18	17.47	30.89	14.91	—
Texas Instruments Inc.	90.39	27.05	24.23	27.67	20.75	—
EV/FCFF, Sector
Semiconductors & Semiconductor Equipment	61.89	35.30	26.37	22.20	18.38	—
EV/FCFF, Industry
Information Technology	34.32	27.25	28.19	24.28	19.87	—

Based on: 10-K (reporting date: 2023-10-29), 10-K (reporting date: 2022-10-30), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-25), 10-K (reporting date: 2019-10-27), 10-K (reporting date: 2018-10-28).

¹ See details »

² See details »

³ 2023 Calculation
EV/FCFF = EV ÷ FCFF
= 133,385 ÷ 7,667 = 17.40

⁴ Click competitor name to see calculations.

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Valuation ratio	Description	The company
EV/FCFF	Enterprise value to free cash flow to the firm is whole company valuation indicator.	Applied Materials Inc. EV/FCFF ratio decreased from 2021 to 2022 and from 2022 to 2023.

Applied Materials Inc. (NASDAQ:AMAT)

Enterprise Value to FCFF (EV/FCFF)

Free Cash Flow to The Firm (FCFF)

Interest Paid, Net of Tax

Enterprise Value to FCFF Ratio, Current

Enterprise Value to FCFF Ratio, Historical