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Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.

Economic Profit
Net Operating Profit after Taxes (NOPAT)
Cash Operating Taxes
Invested Capital
Cost of Capital
Economic Spread Ratio
Economic Profit Margin

Elevance Health Inc., economic profit calculation

US$ in millions

12 months ended:	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Net operating profit after taxes (NOPAT)¹	7,015)	6,415)	6,841)	7,193)	4,739)
Cost of capital²	10.83%	11.55%	11.55%	11.20%	10.62%
Invested capital³	78,241)	69,669)	66,804)	63,876)	56,634)

Economic profit⁴	(1,457)	(1,631)	(874)	41)	(1,278)

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 NOPAT. See details »

² Cost of capital. See details »

³ Invested capital. See details »

⁴ 2024 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= 7,015 – 10.83% × 78,241 = -1,457

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Item	Description	The company
Economic profit	Economic profit is a measure of corporate performance computed by taking the spread between the return on invested capital and the cost of capital, and multiplying by the invested capital.	Elevance Health Inc. economic profit decreased from 2022 to 2023 but then slightly increased from 2023 to 2024.

Elevance Health Inc., NOPAT calculation

US$ in millions

12 months ended:	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Shareholders’ net income	5,980)	5,987)	6,025)	6,104)	4,572)
Deferred income tax expense (benefit)¹	(361)	(690)	4)	180)	(526)
Increase (decrease) in allowance for doubtful accounts²	443)	276)	124)	266)	49)
Increase (decrease) in equity equivalents³	82)	(414)	128)	446)	(477)
Interest expenses	1,185)	1,030)	851)	798)	784)
Interest expense, operating lease liability⁴	32)	31)	28)	27)	31)
Adjusted interest expenses	1,217)	1,061)	879)	825)	815)
Tax benefit of interest expenses⁵	(256)	(223)	(185)	(173)	(171)
Adjusted interest expenses, after taxes⁶	962)	838)	694)	652)	644)
Net income (loss) attributable to noncontrolling interest	(9)	4)	(6)	(9)	—)
Net operating profit after taxes (NOPAT)	7,015)	6,415)	6,841)	7,193)	4,739)

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 Elimination of deferred tax expense. See details »

² Addition of increase (decrease) in allowance for doubtful accounts.

³ Addition of increase (decrease) in equity equivalents to shareholders’ net income.

⁴ 2024 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= 811 × 3.96% = 32

⁵ 2024 Calculation
Tax benefit of interest expenses = Adjusted interest expenses × Statutory income tax rate
= 1,217 × 21.00% = 256

⁶ Addition of after taxes interest expense to shareholders’ net income.

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Item	Description	The company
NOPAT	Net operating profit after taxes is income from operations, but after removement of taxes calculated on cash basis that are relevant to operating income.	Elevance Health Inc. NOPAT decreased from 2022 to 2023 but then increased from 2023 to 2024 exceeding 2022 level.

Elevance Health Inc., cash operating taxes calculation

US$ in millions

12 months ended:	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Income tax expense	1,933)	1,724)	1,750)	1,830)	1,666)
Less: Deferred income tax expense (benefit)	(361)	(690)	4)	180)	(526)
Add: Tax savings from interest expenses	256)	223)	185)	173)	171)
Cash operating taxes	2,550)	2,637)	1,931)	1,823)	2,363)

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).

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Item	Description	The company
Cash operating taxes	Cash operating taxes are estimated by adjusting income tax expense for changes in deferred taxes and tax benefit from the interest deduction.	Elevance Health Inc. cash operating taxes increased from 2022 to 2023 but then slightly decreased from 2023 to 2024.

Elevance Health Inc., invested capital calculation (financing approach)

US$ in millions

	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Short-term borrowings	365)	225)	265)	275)	—)
Current portion of long-term debt	1,649)	1,649)	1,500)	1,599)	700)
Long-term debt, less current portion	29,218)	23,246)	22,349)	21,157)	19,335)
Operating lease liability¹	811)	849)	932)	997)	957)
Total reported debt & leases	32,043)	25,969)	25,046)	24,028)	20,992)
Shareholders’ equity	41,315)	39,306)	36,307)	36,060)	33,199)
Net deferred tax (assets) liabilities²	1,942)	1,742)	1,897)	2,702)	2,019)
Allowance for doubtful accounts³	1,683)	1,240)	964)	840)	574)
Equity equivalents⁴	3,625)	2,982)	2,861)	3,542)	2,593)
Accumulated other comprehensive (income) loss, net of tax⁵	1,147)	1,313)	2,503)	178)	(150)
Noncontrolling interests	111)	99)	87)	68)	—)
Adjusted shareholders’ equity	46,198)	43,700)	41,758)	39,848)	35,642)
Invested capital	78,241)	69,669)	66,804)	63,876)	56,634)

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 Addition of capitalized operating leases.

² Elimination of deferred taxes from assets and liabilities. See details »

³ Addition of allowance for doubtful accounts receivable.

⁴ Addition of equity equivalents to shareholders’ equity.

⁵ Removal of accumulated other comprehensive income.

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Item	Description	The company
Invested capital	Capital is an approximation of the economic book value of all cash invested in going-concern business activities.	Elevance Health Inc. invested capital increased from 2022 to 2023 and from 2023 to 2024.

Elevance Health Inc., cost of capital calculations

Dec 31, 2024

	Capital (fair value)¹	Weights					Cost of capital
Equity²	88,781)	88,781)	÷	118,417)	=	0.75	0.75	×	13.29%	=	9.96%
Debt³	28,825)	28,825)	÷	118,417)	=	0.24	0.24	×	4.39% × (1 – 21.00%)	=	0.84%
Operating lease liability⁴	811)	811)	÷	118,417)	=	0.01	0.01	×	3.96% × (1 – 21.00%)	=	0.02%
Total:	118,417)					1.00					10.83%

Based on: 10-K (reporting date: 2024-12-31).

¹ US$ in millions

² Equity. See details »

³ Debt. See details »

⁴ Operating lease liability. See details »

Dec 31, 2023

	Capital (fair value)¹	Weights					Cost of capital
Equity²	118,517)	118,517)	÷	143,160)	=	0.83	0.83	×	13.29%	=	11.00%
Debt³	23,794)	23,794)	÷	143,160)	=	0.17	0.17	×	4.05% × (1 – 21.00%)	=	0.53%
Operating lease liability⁴	849)	849)	÷	143,160)	=	0.01	0.01	×	3.66% × (1 – 21.00%)	=	0.02%
Total:	143,160)					1.00					11.55%

Based on: 10-K (reporting date: 2023-12-31).

¹ US$ in millions

² Equity. See details »

³ Debt. See details »

⁴ Operating lease liability. See details »

Dec 31, 2022

	Capital (fair value)¹	Weights					Cost of capital
Equity²	115,673)	115,673)	÷	139,194)	=	0.83	0.83	×	13.29%	=	11.04%
Debt³	22,589)	22,589)	÷	139,194)	=	0.16	0.16	×	3.83% × (1 – 21.00%)	=	0.49%
Operating lease liability⁴	932)	932)	÷	139,194)	=	0.01	0.01	×	2.98% × (1 – 21.00%)	=	0.02%
Total:	139,194)					1.00					11.55%

Based on: 10-K (reporting date: 2022-12-31).

¹ US$ in millions

² Equity. See details »

³ Debt. See details »

⁴ Operating lease liability. See details »

Dec 31, 2021

	Capital (fair value)¹	Weights					Cost of capital
Equity²	110,657)	110,657)	÷	138,066)	=	0.80	0.80	×	13.29%	=	10.65%
Debt³	26,412)	26,412)	÷	138,066)	=	0.19	0.19	×	3.51% × (1 – 21.00%)	=	0.53%
Operating lease liability⁴	997)	997)	÷	138,066)	=	0.01	0.01	×	2.69% × (1 – 21.00%)	=	0.02%
Total:	138,066)					1.00					11.20%

Based on: 10-K (reporting date: 2021-12-31).

¹ US$ in millions

² Equity. See details »

³ Debt. See details »

⁴ Operating lease liability. See details »

Dec 31, 2020

	Capital (fair value)¹	Weights					Cost of capital
Equity²	72,573)	72,573)	÷	97,799)	=	0.74	0.74	×	13.29%	=	9.86%
Debt³	24,269)	24,269)	÷	97,799)	=	0.25	0.25	×	3.77% × (1 – 21.00%)	=	0.74%
Operating lease liability⁴	957)	957)	÷	97,799)	=	0.01	0.01	×	3.21% × (1 – 21.00%)	=	0.02%
Total:	97,799)					1.00					10.62%

Based on: 10-K (reporting date: 2020-12-31).

¹ US$ in millions

² Equity. See details »

³ Debt. See details »

⁴ Operating lease liability. See details »

Elevance Health Inc., economic spread ratio 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)
Economic profit¹	(1,457)	(1,631)	(874)	41)	(1,278)
Invested capital²	78,241)	69,669)	66,804)	63,876)	56,634)
Performance Ratio
Economic spread ratio³	-1.86%	-2.34%	-1.31%	0.06%	-2.26%
Benchmarks
Economic Spread Ratio, Competitors⁴
Abbott Laboratories	-2.29%	-2.60%	-0.38%	0.07%	-3.20%
Cigna Group	-2.34%	-2.82%	0.23%	-0.68%	2.21%
CVS Health Corp.	-3.22%	-0.44%	-4.89%	-0.90%	-0.26%
Intuitive Surgical Inc.	9.92%	3.47%	3.19%	18.80%	6.79%
Medtronic PLC	-5.07%	-4.82%	-3.58%	-5.19%	-4.28%
UnitedHealth Group Inc.	-0.31%	4.57%	3.60%	3.45%	4.08%

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 Economic profit. See details »

² Invested capital. See details »

³ 2024 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × -1,457 ÷ 78,241 = -1.86%

⁴ Click competitor name to see calculations.

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Performance ratio	Description	The company
Economic spread ratio	The ratio of economic profit to invested capital, also equal to the difference between return on invested capital (ROIC) and cost of capital.	Elevance Health Inc. economic spread ratio deteriorated from 2022 to 2023 but then slightly improved from 2023 to 2024.

Elevance Health Inc., economic profit margin 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)
Economic profit¹	(1,457)	(1,631)	(874)	41)	(1,278)
Operating revenue	175,204)	170,209)	155,660)	136,943)	120,808)
Performance Ratio
Economic profit margin²	-0.83%	-0.96%	-0.56%	0.03%	-1.06%
Benchmarks
Economic Profit Margin, Competitors³
Abbott Laboratories	-3.28%	-3.87%	-0.54%	0.10%	-5.58%
Cigna Group	-0.78%	-1.24%	0.11%	-0.36%	1.30%
CVS Health Corp.	-1.14%	-0.17%	-1.88%	-0.40%	-0.13%
Intuitive Surgical Inc.	9.22%	3.46%	2.75%	14.79%	6.96%
Medtronic PLC	-10.75%	-10.88%	-7.86%	-12.46%	-10.54%
UnitedHealth Group Inc.	-0.16%	2.27%	1.85%	1.70%	2.08%

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 Economic profit. See details »

² 2024 Calculation
Economic profit margin = 100 × Economic profit ÷ Operating revenue
= 100 × -1,457 ÷ 175,204 = -0.83%

³ Click competitor name to see calculations.

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Performance ratio	Description	The company
Economic profit margin	The ratio of economic profit to sales. It is the company profit margin covering income efficiency and asset management. Economic profit margin is not biased in favor of capital-intensive business models, because any added capital is a cost to the economic profit margin.	Elevance Health Inc. economic profit margin deteriorated from 2022 to 2023 but then slightly improved from 2023 to 2024.

Elevance Health Inc. (NYSE:ELV)

Economic Value Added (EVA)

Economic Profit

Net Operating Profit after Taxes (NOPAT)

Cash Operating Taxes

Invested Capital

Cost of Capital

Economic Spread Ratio

Economic Profit Margin