Price to FCFE (P/FCFE)
Free Cash Flow to Equity (FCFE)
Anadarko Petroleum Corp., FCFE calculation
US$ in millions
Based on: 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31).
An analysis of the cash flow metrics from 2012 to 2016 reveals a period of significant volatility, characterized by a severe liquidity contraction in 2015 followed by a partial operational recovery in 2016.
- Net Cash Provided by Operating Activities
- Operating cash flows remained relatively stable and strong between 2012 and 2014, fluctuating within a range of 8.3 billion to 8.9 billion US dollars. However, a sharp reversal occurred in 2015, with cash provided by operating activities falling to a deficit of 1.877 billion US dollars. While 2016 showed a return to positive territory with 3 billion US dollars, this figure represents a substantial decrease compared to the pre-2015 operational performance.
- Free Cash Flow to Equity (FCFE)
- FCFE exhibited extreme instability throughout the period. After moving from a deficit of 974 million US dollars in 2012 to a peak of 1.402 billion US dollars in 2013, the metric declined to 474 million US dollars in 2014. The most critical decline occurred in 2015, where FCFE plummeted to negative 7.368 billion US dollars. Despite the operational recovery in 2016, FCFE remained negative at 1.398 billion US dollars, indicating that cash outflows for capital expenditures or debt obligations continued to exceed operating cash inflows.
- Comparative Cash Flow Dynamics
- A widening divergence between operating cash flow and FCFE is evident, particularly in 2015. During that year, the FCFE deficit was significantly more pronounced than the operating cash deficit, suggesting that the company faced heavy capital expenditures or significant debt repayments during a period of operational distress. The fact that FCFE remained negative in 2016 despite positive operating cash flow further underscores a period of continued capital intensity or aggressive deleveraging.
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Price to FCFE Ratio, Current
Anadarko Petroleum Corp., current P/FCFE calculation, comparison to benchmarks
| No. shares of common stock outstanding | 547,157,557 |
| Selected Financial Data (US$) | |
| Free cash flow to equity (FCFE) (in millions) | (1,398) |
| FCFE per share | -2.56 |
| Current share price (P) | 49.37 |
| Valuation Ratio | |
| P/FCFE | — |
| Benchmarks | |
| P/FCFE, Competitors1 | |
| Chevron Corp. | 18.18 |
| ConocoPhillips | 24.06 |
| Exxon Mobil Corp. | 28.50 |
Based on: 10-K (reporting date: 2016-12-31).
1 Click competitor name to see calculations.
If the company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.
Otherwise, if the company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.
Price to FCFE Ratio, Historical
Anadarko Petroleum Corp., historical P/FCFE calculation, comparison to benchmarks
| Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | Dec 31, 2012 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 558,979,551 | 508,438,647 | 506,650,285 | 503,767,298 | 500,565,966 | |
| Selected Financial Data (US$) | ||||||
| Free cash flow to equity (FCFE) (in millions)2 | (1,398) | (7,368) | 474) | 1,402) | (974) | |
| FCFE per share3 | -2.50 | -14.49 | 0.94 | 2.78 | -1.95 | |
| Share price1, 4 | 66.77 | 40.50 | 85.45 | 84.16 | 84.13 | |
| Valuation Ratio | ||||||
| P/FCFE5 | — | — | 91.34 | 30.24 | — | |
| Benchmarks | ||||||
| P/FCFE, Competitors6 | ||||||
| Chevron Corp. | — | — | — | — | — | |
| ConocoPhillips | — | — | — | — | — | |
| Exxon Mobil Corp. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31).
1 Data adjusted for splits and stock dividends.
3 2016 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= -1,398,000,000 ÷ 558,979,551 = -2.50
4 Closing price as at the filing date of Anadarko Petroleum Corp. Annual Report.
5 2016 Calculation
P/FCFE = Share price ÷ FCFE per share
= 66.77 ÷ -2.50 = —
6 Click competitor name to see calculations.
An analysis of the financial metrics between 2012 and 2016 reveals significant volatility in both equity valuation and cash flow generation. The share price remained relatively stable through 2014 before experiencing a sharp decline in 2015 and a subsequent partial recovery in 2016.
- Free Cash Flow to Equity (FCFE) Performance
- FCFE per share exhibited extreme instability, transitioning from a negative value in 2012 to positive figures in 2013 and 2014. A substantial deficit occurred in 2015, with FCFE per share dropping to -14.49 US$, followed by a smaller negative value of -2.50 US$ in 2016. This pattern suggests periods where capital expenditures and debt repayments significantly exceeded operational cash inflows.
- Price to FCFE (P/FCFE) Ratio Analysis
- The P/FCFE ratio was only applicable during the years of positive cash flow generation. In 2013, the ratio stood at 30.24. By 2014, the ratio escalated sharply to 91.34, driven by a contraction in FCFE per share from 2.78 US$ to 0.94 US$ while the share price remained nearly constant. The absence of a ratio in 2012, 2015, and 2016 is a direct result of negative FCFE values, which renders the metric inapplicable for traditional valuation.
- Valuation and Cash Flow Correlation
- A disconnect is observed between the share price and cash flow performance during the 2013-2014 period, as the market valuation remained elevated despite a steep decline in per-share cash flow. The subsequent price collapse in 2015 aligns with the most severe negative FCFE recorded in the period, indicating a market correction corresponding to the deterioration of cash flow viability.
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