Market Value Added (MVA)
Market value added (MVA) is the difference between a firm fair value and its invested capital. MVA is a measure of the value a company has created in excess of the resources already committed to the enterprise.
MVA
Illinois Tool Works Inc., MVA calculation
US$ in millions
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 Fair value of debt. See details »
2 Invested capital. See details »
| Item | Description | The company |
|---|---|---|
| MVA | Illinois Tool Works Inc. market (fair) value less invested capital. | Illinois Tool Works Inc. MVA increased from 2019 to 2020 and from 2020 to 2021. |
MVA Spread Ratio
Illinois Tool Works Inc., MVA spread ratio calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Market value added (MVA)1 | 63,276) | 59,810) | 55,666) | 42,295) | 50,578) | |
| Invested capital2 | 13,555) | 13,434) | 13,033) | 12,895) | 14,406) | |
| Performance Ratio | ||||||
| MVA spread ratio3 | 466.81% | 445.21% | 427.11% | 327.99% | 351.08% | |
| Benchmarks | ||||||
| MVA Spread Ratio, Competitors4 | ||||||
| Boeing Co. | 256.38% | 257.78% | 489.80% | — | — | |
| Caterpillar Inc. | 164.79% | 176.94% | 108.09% | — | — | |
| Eaton Corp. plc | 132.30% | 124.83% | 66.62% | — | — | |
| GE Aerospace | 110.77% | 64.66% | 58.28% | — | — | |
| Honeywell International Inc. | 209.78% | 236.48% | 239.06% | — | — | |
| Lockheed Martin Corp. | 319.28% | 284.59% | 441.62% | — | — | |
| RTX Corp. | 57.80% | 31.41% | 82.79% | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 MVA. See details »
2 Invested capital. See details »
3 2021 Calculation
MVA spread ratio = 100 × MVA ÷ Invested capital
= 100 × 63,276 ÷ 13,555 = 466.81%
4 Click competitor name to see calculations.
| Performance ratio | Description | The company |
|---|---|---|
| MVA spread ratio | The ratio of MVA to invested capital. It measures the efficiency with which investors’ capital investment has translated into a franchise value and into an aggregate net present value premium. | Illinois Tool Works Inc. MVA spread ratio improved from 2019 to 2020 and from 2020 to 2021. |
MVA Margin
Illinois Tool Works Inc., MVA margin calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Market value added (MVA)1 | 63,276) | 59,810) | 55,666) | 42,295) | 50,578) | |
| Operating revenue | 14,455) | 12,574) | 14,109) | 14,768) | 14,314) | |
| Add: Increase (decrease) in deferred revenue and customer deposits | 172) | 34) | (27) | 10) | 25) | |
| Adjusted operating revenue | 14,627) | 12,608) | 14,082) | 14,778) | 14,339) | |
| Performance Ratio | ||||||
| MVA margin2 | 432.60% | 474.38% | 395.30% | 286.20% | 352.73% | |
| Benchmarks | ||||||
| MVA Margin, Competitors3 | ||||||
| Boeing Co. | 203.39% | 211.11% | 227.39% | — | — | |
| Caterpillar Inc. | 190.18% | 245.71% | 116.96% | — | — | |
| Eaton Corp. plc | 198.58% | 191.64% | 91.84% | — | — | |
| GE Aerospace | 111.81% | 103.34% | 86.63% | — | — | |
| Honeywell International Inc. | 293.22% | 350.74% | 278.15% | — | — | |
| Lockheed Martin Corp. | 136.30% | 122.08% | 189.58% | — | — | |
| RTX Corp. | 102.95% | 64.17% | 111.10% | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 MVA. See details »
2 2021 Calculation
MVA margin = 100 × MVA ÷ Adjusted operating revenue
= 100 × 63,276 ÷ 14,627 = 432.60%
3 Click competitor name to see calculations.
| Performance ratio | Description | The company |
|---|---|---|
| MVA margin | The ratio of MVA to sales. It measures how efficiently and prodigiously sales translate into franchise value. | Illinois Tool Works Inc. MVA margin ratio improved from 2019 to 2020 but then slightly deteriorated from 2020 to 2021 not reaching 2019 level. |