Enterprise Value to FCFF (EV/FCFF)
Free Cash Flow to The Firm (FCFF)
Mosaic Co., FCFF calculation
US$ in thousands
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, 2 See details »
The financial data reveals notable trends in operating cash flow and free cash flow to the firm over the five-year period from 2017 to 2021.
- Net Cash Provided by Operating Activities
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Operating cash flow demonstrates an overall upward trajectory. Starting at $935.5 million in 2017, it increased significantly to $1.41 billion in 2018. Although there was a decline in 2019 to approximately $1.1 billion, the figure recovered strongly in 2020, reaching $1.58 billion, and peaked in 2021 at $2.19 billion. This indicates improving operational efficiency or higher earnings generating cash inflows, especially evident in the post-2019 period.
- Free Cash Flow to the Firm (FCFF)
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The FCFF presents a more volatile pattern. Beginning at around $231.7 million in 2017, it surged to $623.9 million in 2018 but then experienced a sharp decline in 2019 to roughly $13.1 million. Following this low point, FCFF rebounded to $595.9 million in 2020 and further increased to approximately $1.06 billion in 2021. The pronounced dip in 2019 may suggest increased capital expenditures, changes in working capital, or other investing activities that year, followed by a recovery in subsequent years.
In summary, while net operating cash flows increased steadily after a minor setback in 2019, the free cash flow to the firm showed higher volatility with a significant trough in 2019, before robust recovery. This pattern may imply variations in investment activities or capital deployment alongside improving operational cash generation capability.
Interest Paid, Net of Tax
Mosaic Co., interest paid, net of tax calculation
US$ in thousands
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).
2 2021 Calculation
Cash paid during the period for interest, less amount capitalized, tax = Cash paid during the period for interest, less amount capitalized × EITR
= 189,900 × 26.90% = 51,083
3 2021 Calculation
Capitalized interest on major construction projects, tax = Capitalized interest on major construction projects × EITR
= 30,100 × 26.90% = 8,097
- Effective Income Tax Rate (EITR)
- The effective income tax rate shows a notable decline from 35% in 2017 to a low of 14% in 2018. Subsequently, it exhibits a gradual upward trend, increasing to 17.9% in 2019, then to 21% in 2020, and reaching 26.9% by the end of 2021. This indicates a period of reduced tax burden in 2018, followed by a steady return towards higher tax rates over the following years.
- Cash Paid During the Period for Interest, Net of Tax
- The cash paid for interest, after adjustments and tax considerations, rose significantly from approximately $100.8 million in 2017 to a peak of $166.5 million in 2019. In 2020, this amount slightly decreased to about $157.6 million, and further declined to $138.8 million by 2021. Despite the decline after 2019, the cash interest payments remain substantially higher than the 2017 baseline, suggesting increased debt servicing costs or higher borrowings during this period with a gradual easing in the last two years.
- Capitalized Interest on Major Construction Projects, Net of Tax
- Capitalized interest displayed a consistent upward trajectory from $15.5 million in 2017 to a peak of $26.3 million in 2020. In 2021, however, this figure decreased to $22.0 million. The increase until 2020 reflects growing investment in major construction projects, which requires capitalization of interest costs. The slight decline in 2021 may indicate a reduction or completion of such projects or a change in capitalization policy.
Enterprise Value to FCFF Ratio, Current
Mosaic Co., current EV/FCFF calculation, comparison to benchmarks
| Selected Financial Data (US$ in thousands) | |
| Enterprise value (EV) | 22,430,053) |
| Free cash flow to the firm (FCFF) | 1,059,220) |
| Valuation Ratio | |
| EV/FCFF | 21.18 |
| Benchmarks | |
| EV/FCFF, Competitors1 | |
| Linde plc | 45.14 |
| Sherwin-Williams Co. | 40.09 |
| EV/FCFF, Sector | |
| Chemicals | 36.91 |
| EV/FCFF, Industry | |
| Materials | 27.18 |
Based on: 10-K (reporting date: 2021-12-31).
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
Mosaic Co., historical EV/FCFF calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Enterprise value (EV)1 | 21,047,779) | 16,076,972) | 12,013,679) | 15,543,777) | 14,060,312) | |
| Free cash flow to the firm (FCFF)2 | 1,059,220) | 595,912) | 13,097) | 623,860) | 231,685) | |
| Valuation Ratio | ||||||
| EV/FCFF3 | 19.87 | 26.98 | 917.26 | 24.92 | 60.69 | |
| Benchmarks | ||||||
| EV/FCFF, Competitors4 | ||||||
| Linde plc | 23.60 | 34.03 | — | — | — | |
| Sherwin-Williams Co. | 36.70 | 21.39 | — | — | — | |
| EV/FCFF, Sector | ||||||
| Chemicals | 26.76 | 28.47 | — | — | — | |
| EV/FCFF, Industry | ||||||
| Materials | 20.85 | 30.81 | — | — | — | |
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).
3 2021 Calculation
EV/FCFF = EV ÷ FCFF
= 21,047,779 ÷ 1,059,220 = 19.87
4 Click competitor name to see calculations.
- Enterprise Value (EV) Trends
- The enterprise value showed an overall upward trajectory from 2017 through 2021, increasing from approximately $14.1 billion to $21.0 billion. Notably, there was a decline in 2019 to about $12.0 billion, followed by a significant recovery and growth in 2020 and 2021, reaching its highest point in the five-year period.
- Free Cash Flow to the Firm (FCFF) Movements
- Free cash flow to the firm demonstrated fluctuating behavior with a large peak in 2018 at around $624 million, followed by a sharp decrease in 2019 to approximately $13 million. Subsequent years showed a marked recovery and growth to approximately $596 million in 2020 and $1.06 billion in 2021, representing the highest level observed.
- EV to FCFF Ratio Analysis
- The EV/FCFF ratio exhibited considerable volatility, with an exceptionally high ratio in 2019 (917.26), indicative of a significant disconnect between enterprise valuation and free cash flow generation that year. In other years, the ratio remained between roughly 20 and 61, decreasing overall from 60.69 in 2017 to 19.87 in 2021. This downward trend suggests improving valuation relative to cash flow in recent years, particularly as the ratio approaches more typical levels in 2020 and 2021.
- Overall Insights
- The data suggests a period of volatility around 2019, where free cash flow plummeted and the valuation metric spiked sharply, potentially signaling operational challenges or market revaluation. The strong recovery in cash flow and enterprise value during 2020 and 2021 reflects improved financial health or market confidence. The declining EV/FCFF ratio may indicate a more balanced and sustainable valuation in relation to cash generation capabilities.