Enterprise Value to FCFF (EV/FCFF)
Free Cash Flow to The Firm (FCFF)
Intuitive Surgical Inc., FCFF calculation
US$ in thousands
Based on: 10-K (reporting date: 2025-12-31), 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).
The financial information reveals fluctuations in both net cash provided by operating activities and free cash flow to the firm (FCFF) over the five-year period. A notable decrease in FCFF is observed between 2021 and 2023, followed by a recovery in subsequent years.
- Net Cash from Operations
- Net cash provided by operating activities decreased from US$2,089.4 million in 2021 to US$1,490.8 million in 2022, representing a substantial decline. This was followed by a partial recovery to US$1,813.8 million in 2023, and continued growth to US$2,415.0 million in 2024 and US$3,030.5 million in 2025. The trend indicates increasing operational cash generation in the later years of the period.
- Free Cash Flow to the Firm (FCFF)
- FCFF experienced a significant reduction from US$1,749.9 million in 2021 to US$958.4 million in 2022. This downward trend continued in 2023, reaching a low of US$749.6 million. However, FCFF began to recover in 2024, increasing to US$1,303.8 million, and demonstrated strong growth in 2025, reaching US$2,490.7 million. The recovery in FCFF mirrors, but is less pronounced than, the recovery in net cash from operations.
The divergence between the operating cash flow and FCFF suggests changes in capital expenditure or other non-operating cash outflows. The substantial increase in both metrics in 2024 and 2025 indicates improved cash generation capabilities and potentially increased investment capacity.
- Relationship between Operating Cash Flow and FCFF
- While both metrics generally move in the same direction, the difference between them widens in 2022 and 2023, before narrowing again in 2024 and 2025. This suggests that factors impacting FCFF, such as capital expenditures or changes in working capital, had a more pronounced effect during those years. The increasing correlation in the later years indicates a stronger link between operational performance and available free cash flow.
Overall, the period demonstrates a challenging period for cash flow followed by a strong recovery, suggesting potential operational improvements or strategic shifts that positively impacted cash generation.
Interest Paid, Net of Tax
Intuitive Surgical Inc., interest paid, net of tax calculation
US$ in thousands
Based on: 10-K (reporting date: 2025-12-31), 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).
2 2025 Calculation
Interest paid, tax = Interest paid × EITR
= 0 × 13.10% = 0
The effective income tax rate exhibits fluctuations over the observed period. Beginning at 8.58% in 2021, the rate increased to 16.33% in 2022 before declining to 7.23% in 2023. A subsequent increase is noted in 2024, reaching 12.58%, followed by a further increase to 13.10% in 2025. No information regarding interest paid, net of tax, is available for any of the years presented.
- Effective Income Tax Rate (EITR) - Trend Analysis
- The EITR demonstrates volatility. The substantial increase from 2021 to 2022 suggests a change in the company’s taxable income composition or applicable tax laws. The subsequent decrease in 2023 could be attributed to tax benefits, changes in jurisdictional mix of earnings, or adjustments to deferred tax assets/liabilities. The increases in 2024 and 2025 indicate a potential return towards a higher normalized tax rate, though further investigation would be needed to confirm the underlying drivers.
The absence of values for “Interest paid, net of tax” prevents any analysis of this financial item. Without this information, it is impossible to assess the company’s interest expense and its impact on profitability after considering tax effects. The lack of this information limits a comprehensive understanding of the company’s financial performance.
- Interest Paid, Net of Tax - Data Absence
- The complete lack of reported values for interest paid, net of tax, across all periods is a significant omission. This absence hinders the ability to evaluate the company’s debt financing costs and their after-tax implications. Further inquiry is necessary to determine the reason for this missing information.
Enterprise Value to FCFF Ratio, Current
Intuitive Surgical Inc., current EV/FCFF calculation, comparison to benchmarks
| Selected Financial Data (US$ in thousands) | |
| Enterprise value (EV) | 167,539,623) |
| Free cash flow to the firm (FCFF) | 2,490,700) |
| Valuation Ratio | |
| EV/FCFF | 67.27 |
| Benchmarks | |
| EV/FCFF, Competitors1 | |
| Abbott Laboratories | 29.16 |
| Elevance Health Inc. | 13.12 |
| Medtronic PLC | 26.06 |
| UnitedHealth Group Inc. | 12.97 |
| EV/FCFF, Sector | |
| Health Care Equipment & Services | 20.26 |
| EV/FCFF, Industry | |
| Health Care | 26.25 |
Based on: 10-K (reporting date: 2025-12-31).
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
Intuitive Surgical Inc., historical EV/FCFF calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Enterprise value (EV)1 | 164,247,568) | 200,047,585) | 128,123,188) | 81,892,877) | 98,018,095) | |
| Free cash flow to the firm (FCFF)2 | 2,490,700) | 1,303,800) | 749,600) | 958,400) | 1,749,900) | |
| Valuation Ratio | ||||||
| EV/FCFF3 | 65.94 | 153.43 | 170.92 | 85.45 | 56.01 | |
| Benchmarks | ||||||
| EV/FCFF, Competitors4 | ||||||
| Abbott Laboratories | — | 35.21 | 36.51 | 23.24 | 23.47 | |
| Elevance Health Inc. | — | 15.57 | 14.19 | 13.32 | 12.74 | |
| Medtronic PLC | 22.40 | 20.58 | 26.54 | 20.32 | 33.84 | |
| UnitedHealth Group Inc. | — | 20.57 | 17.59 | 19.30 | 22.21 | |
| EV/FCFF, Sector | ||||||
| Health Care Equipment & Services | — | 25.57 | 22.68 | 20.44 | 23.51 | |
| EV/FCFF, Industry | ||||||
| Health Care | — | 24.03 | 25.94 | 18.56 | 17.80 | |
Based on: 10-K (reporting date: 2025-12-31), 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).
3 2025 Calculation
EV/FCFF = EV ÷ FCFF
= 164,247,568 ÷ 2,490,700 = 65.94
4 Click competitor name to see calculations.
The Enterprise Value to Free Cash Flow to the Firm (EV/FCFF) ratio exhibits significant fluctuations over the observed period. Initially, the ratio increased substantially before declining again. Enterprise Value and Free Cash Flow to the Firm both experienced changes throughout the period, contributing to the observed ratio movements.
- EV/FCFF Ratio Trend
- The EV/FCFF ratio increased from 56.01 in 2021 to a peak of 170.92 in 2023. This indicates a growing disparity between the company’s enterprise value and the free cash flow it generates. Subsequently, the ratio decreased to 153.43 in 2024 and further to 65.94 in 2025. The decline in 2025 suggests that the enterprise value is becoming more aligned with the generated free cash flow.
- Enterprise Value (EV) Trend
- Enterprise Value decreased from US$98,018,095 thousand in 2021 to US$81,892,877 thousand in 2022. A substantial increase followed, reaching US$128,123,188 thousand in 2023, and peaking at US$200,047,585 thousand in 2024. In 2025, Enterprise Value decreased to US$164,247,568 thousand. These fluctuations likely reflect changes in market perceptions of the company’s value, debt levels, and equity valuations.
- Free Cash Flow to the Firm (FCFF) Trend
- Free Cash Flow to the Firm decreased from US$1,749,900 thousand in 2021 to US$958,400 thousand in 2022, and continued to decline to US$749,600 thousand in 2023. FCFF then increased to US$1,303,800 thousand in 2024 and reached US$2,490,700 thousand in 2025. This suggests improving cash generation capabilities in the later years of the period.
The combined effect of the Enterprise Value and Free Cash Flow to the Firm trends explains the EV/FCFF ratio’s behavior. The initial increase in the ratio was driven by a decrease in FCFF coupled with a relatively stable EV. The subsequent decline in the ratio in 2024 and 2025 is attributable to the significant increase in FCFF, partially offset by the decrease in Enterprise Value in 2025.