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Texas Instruments Inc (TXN) Extended Graph Alalysis

May 18th, 2020 Posted by Extended Analysis No Comment yet

Company Profile

TXN LOGO

Texas Instruments Incorporated (NASDAQ: TXN) designs and manufactures, tests and sells analog and embedded semiconductor chips around the world. The company was founded in 1930 as Geophysical Service Inc., an oil and gas exploration company however in the 1950s became officially Texas Instruments Incorporated a semiconductor conductor industry. Headquartered in Dallas, Texas in the United States.

The company market in electronic systems includes industrial, automotive, personal electronics, communications equipment and enterprise systems.

 

Texas Instruments (TXN) Extended graph Analysis

 

1. TXN CASH FLOW

TXN CASH FLOW

2015 2016 2017 2018 2019 2020
Net cash flow provided by operating activitIes 4,268,000,000 4,614,000,000 5,363,000,000 7,189,000,000 6,649,000,000 6,393,000,000
Net cash used for investing activities -302,000,000 -650,000,000 -1,127,000,000 -78,000,000 -1,920,000,000 -2,267,000,000
Net cash provided by (used for) financing activities -4,165,000,000 -3,810,000,000 -3,734,000,000 -6,329,000,000 -4,730,000,000 -5,328,000,000
Capital expenditure -551,000,000 -531,000,000 -695,000,000 -1,131,000,000 -847,000,000 -757,000,000
Free cash flow 3,717,000,000 4,083,000,000 4,668,000,000 6,058,000,000 5,802,000,000 5,636,000,000
Working Capital 4,519,000,000 5,193,000,000 6,476,000,000 5,623,000,000 6,638,000,000 6,638,000,000

Facts:

  • Cash provided by operating activities was $6 billion in the trailing twelve months.
  • Net cash from investing activities was $-2 billion in the trailing twelve months.
  • Cash provided by (used for) financing activities was $-5 billion in the trailing twelve months.
  • Capital expenditures were $-757 million in the trailing twelve months.
  • Free cash flow was $6 billion in the trailing twelve months.
  • Working capital was $7 billion in the trailing twelve months.

Explanation:

  • Cash from operations has a growth rate of 50% in five years, moreover, the management was able to generate cash from operations in the last five years.
  • Cash from investing activities were investment in property, plant and equipment, and purchases of investments.
  • The cash provided by financing activities were common stock repurchased, dividends paid and other financing activities.
  • Capital expenditures was investment in property, plant and equipment.
  • Free cash flow grew 52 percent in five years.
  • Working capital grew 47 percent in five years.

Interpretation

The management is efficient and capable of producing cash from operations, positive free cash flow and working capital in the last five years.

 

2. TXN BALANCE SHEET

TXN BALANCE SHEET

2015 2016 2017 2018 2019
Total cash 3,218,000,000 3,490,000,000 4,469,000,000 4,233,000,000 5,387,000,000
Current Assets 7,074,000,000 7,457,000,000 8,734,000,000 8,097,000,000 8,761,000,000
Net property, plant and equipment 2,596,000,000 2,512,000,000 2,664,000,000 3,183,000,000 3,303,000,000
Total non-current assets 9,156,000,000 8,974,000,000 8,908,000,000 9,040,000,000 9,257,000,000
Total assets 16,230,000,000 16,431,000,000 17,642,000,000 17,137,000,000 18,018,000,000
Current liabilities 2,555,000,000 2,264,000,000 2,258,000,000 2,474,000,000 2,123,000,000
Non-current liabilities 3,729,000,000 3,694,000,000 5,047,000,000 5,669,000,000 6,988,000,000
Total liabilities 6,284,000,000 5,958,000,000 7,305,000,000 8,143,000,000 9,111,000,000
Retained earnings 31,176,000,000 33,107,000,000 34,662,000,000 37,906,000,000 39,898,000,000
Stockholders equity 9,946,000,000 10,473,000,000 10,337,000,000 8,994,000,000 8,907,000,000

Facts:

  • Total cash was $5 billion in 2019.
  • Current assets were $9 billion in 2019.
  • Net property, plant and equipment was $3 billion in 2019.
  • Non-current assets were $9 billion in 2019.
  • Total assets were $18 billion in 2019.
  • Current liabilities were $2 billion in 2019.
  • Non-current liabilities were $7 billion in 2019.
  • Total liabilities were $9 billion in 2019.
  • Retained earnings were $40 billion in 2019.
  • Stockholders equity was $9 billion in 2019.

Explanation

  • Total cash grew 67 percent in five years and it represents 30 percent of the total assets.
  • Current assets grew 24 percent in five years and it represented 49 percent of total assets.
  • Net property, plant and equipment grew 27 percent in five years and it represented 18 percent of total assets.
  • Non-current assets represented 51 percent of the total assets.
  • Total assets grew 11 percent in five years.
  • Current liabilities represent 23 percent of total liabilities.
  • Non-current liabilities represent 77 percent of total liabilities.
  • Total liabilities represents 51 percent of total liabilities and stockholders equity.
  • Retained earnings increased year-over-year in the last five years.
  • Stockholders equity represents 49 percent of total liabilities and stockholders equity.

Interpretation

The company is liquid and stable, and capable of meeting current obligations in due time. Retained earnings was huge compared to total assets, it was over 121 percent of the total assets. The shareholders have 50 percent stake in the total assets and creditors have also 50 percent stake in total assets.

 

3. TXN INCOME AND MARKET

TXN INCOME AND MARKET

2015 2016 2017 2018 2019 TTM
Revenue 13,000,000,000 13,370,000,000 14,961,000,000 15,784,000,000 14,383,000,000 14,118,000,000
EBIT 4,532,000,000 5,103,000,000 6,531,000,000 7,034,000,000 5,975,000,000 5,811,000,000
Net Income 2,986,000,000 3,595,000,000 3,682,000,000 5,580,000,000 5,017,000,000 4,976,000,000
EBITDA 5,439,000,000 5,965,000,000 7,062,000,000 7,765,000,000 6,948,000,000 6,794,000,000
Market Capitalization 55,428,000,000 72,932,000,000 102,932,000,000 89,317,000,000 119,570,000,000 105,526,000,000
Intrinsic Value 99,968,027,187 125,687,492,273 171,079,397,912 158,840,889,167 232,349,843,836 268,195,183,423

Facts:

  • Revenue was $14 billion in the trailing twelve months.
  • EBIT was $6 billion in the trailing twelve months.
  • Net income was $5 billion in the trailing twelve months.
  • EBITDA was $7 billion the trailing twelve months.
  • Market capitalization was $105.526 billion in the trailing twelve months.
  • Intrinsic value was $268.195 billion in the trailing twelve months.

Explanation

  • Revenue grew 9 percent in five years.
  • EBIT represents 41 percent of revenue.
  • Net income represents 35 percent of revenue and it grew 67 percent in five years.
  • EBITDA represents 48 percent of revenue.
  • Market capitalization grew 90 percent in five years.
  • Intrinsic value was over 154 percent of the market capitalization.

Interpretation

The management was able to generate sufficient revenue for its business operations and net income represents one-third of the revenue which is impressive. The stock price of TXN was undervalued.

 

4. TXN FINANCIAL RATIOS

TXN FINANCIAL RATIOS

2015 2016 2017 2018 2019 TTM
Asset turnover (average) 0.77 0.82 0.88 0.91 0.82 0.81
Return on assets % 17.34 21.74 21.41 31.84 28.54 28.66
Return on equity % 28.94 34.77 35.06 57.29 56.05 61.23
Return on invested capital % 20.6 25.60 25.94 39.62 35.59 35.89
Debt/Equity 0.31 0.28 0.34 0.48 0.62 0.71

Facts:

  • Asset turnover was averaging 0.81 in the trailing twelve months.
  • Return on assets  was 28.66 percent in the trailing twelve months.
  • Return on equity was 61.23 percent in the trailing twelve months.
  • Return on invested capital was 35.89 percent in the trailing twelve months.
  • Debt to Equity ratio was 0.71 in the trailing twelve months.

Explanation:

  • Asset turnover indicates that TXN is generating 81 cents of sales for every dollar invested in assets.
  • Return on assets indicates that the company generates 28.66 cents of net income for every dollar invested in assets.
  • Return on equity indicates that for every dollar invested in common equity it generated 61.23 cents of net income.
  • Debt/Equity ratio indicates that TXN has $0.71 in debt for every dollar of assets.

Interpretation

The financial ratios show that Texas Instruments is in good financial health and liquid. The company was able to generate a good return on the investments made.

 

5. KEY EXECUTIVE COMPENSATION

TXN KEY EXECUTIVE COMPENSATION

2015 2016 2017 2018 2019
Key Executive Compensation
Salary 1,140,250 1,164,083 2,375,087 3,774,169 4,102,917
Bonus 0 0 0 0 0
Annual Other Income 0 0 0 0 0
Restricted Stock Award 4,900,017 4,900,048 9,300,131 12,800,422 13,600,237
Securities Options 4,900,006 4,900,007 8,300,033 12,800,070 13,600,039
LTIP Payout 0 0 0 0 0
Non-Equity Compensation 3,653,877 3,682,817 6,050,018 9,104,833 8,580,583
Other Compensation 317,702 325,510 407,131 642,455 0
Total 14,925,802 15,080,069 25,090,172 39,123,826 42,670,368
Richard K. Templetion/ Chairman of the Board, President and Chief Executive Officer   
Salary 1,140,250 1,164,083 1,188,004 1,131,252 1,295,833
Bonus 0 0 0 0 0
Annual Other Income 0 0 0 0 0
Restricted Stock Award 4,900,017 4,900,048 5,500,010 6,000,091 6,500,045
Securities Options 4,900,006 4,900,007 5,500,004 600,019 6,500,012
LTIP Payout 0 0 0 0 0
Non-Equity Compensation 3,653,877 3,682,817 3,862,601 4,026,250 3,809,167
Other Compensation 317,702 325,510 329,825 418,612 326,162
Total 14,925,802 15,080,069 16,546,722 17,576,224 18,633,807
Rafael R. Lizardi/ SVP and CFO     
Salary 488,333 591,667 655,000
Bonus 0 0 0
Annual Other Income 0 0 0
Restricted Stock Award 2,000,047 1,200,084 1,500,058
Securities Options 1,000,013 1,200,013 1,500,006
LTIP Payout 0 0 0
Non-Equity Compensation 947,667 1,118,333 1,081,000
Other Compensation 60,814 77,072 125,671
Total 4,496,874 4,187,169 4,861,735
R. Gregory (greg) Delagi / Former Senior VP    
Salary 698,750 713,750 728,750.00
Bonus 0 0 0.00
Annual Other Income 0 0 0.00
Restricted Stock Award 1,800,074 1,800,071 1,800,028.00
Securities Options 1,800,016 1,800,008 1,800,003.00
LTIP Payout 0 0 0.00
Non-Equity Compensation 1,239,750 1,292,750 1,125,750.00
Other Compensation 16,492 5,500 6,045.00
Total 7,046,576 5,613,956 7,414,651.00
Niels Anderskouv / Senior VP     
Salary 668,750 711,667.00
Bonus 0 0.00
Annual Other Income 0 0.00
Restricted Stock Award 1,900,088 1,900,053.00
Securities Options 1,900,015 1,900,009.00
LTIP Payout 0 0.00
Non-Equity Compensation 1,333,750 1,282,333.00
Other Compensation 89,458 103,898.00
Total 5,892,061 5,897,960.00
Haviv Ilan / Senior Vice President     
Salary 668,750 711,667.00
Bonus 0 0.00
Annual Other Income 0 0.00
Restricted Stock Award 1,900,088 1,900,053.00
Securities Options 1,900,015 1,900,009.00
LTIP Payout 0 0.00
Non-Equity Compensation 1,333,750 1,282,333.00
Other Compensation 51,813 68,153.00
Total 5,854,416 5,862,215

Facts:

  • The total key executive compensation in 2015 was $ 14,925,802.
  • Total key executive compensation in 2016 was $15,080,069.
  • Total key executive compensation in 2017 was $16,546,722.
  • Key executive compensation in 2018 was $39,123,826.
  • Key executive compensation in 2019 was $42,670,368.

Explanation

  • Total executive compensation represents 0.85 percent of the net income in 2019.
  • Richard K. Templetion, CEO compensation represents 44 percent of the total executive compensation in 2019.
  • Rafael R. Lizardi, CFO compensation represents 11 percent of the total executive compensation in 2019.
  • R. Gregory (greg) Delagi, Former Senior VP compensation represents 17 percent of the total executive compensation in 2019.
  • Niels Anderskouv / Senior VP compensation represents 14 percent of the total executive compensation in 2019.
  • Haviv Ilan / Senior Vice President compensation represents 14 percent of the total executive compensation in 2019.

Interpretation

Total executive compensation includes salary, restricted stock award, securities options, non-equity compensation and other compensation.

 

6. TXN LOBBYING AND CONTRIBUTIONS

TXN LOBBYING AND CONTRIBUTIONS

PERIOD AMOUNT PERIOD AMOUNT
1998 $2,226,000 2010 $1,600,000
1999 $1,910,000 2011 $1,880,000
2000 $2,200,000 2012 $1,810,000
2001 $2,090,000 2013 $1,740,000
2002 $2,600,000 2014 $1,680,000
2003 $1,740,000 2015 $2,050,000
2004 $2,120,000 2016 $1,860,000
2005 $2,200,000 2017 $2,160,000
2006 $2,310,000 2018 $1,960,000
2007 $2,760,000 2019 $1,540,000
2008 $2,140,000 2020 $1,739,631
2009 $1,800,000

Facts:

Texas Instruments Inc is spending lobbying and contributions annually and record shows above lobbying from 1998 to 2019.

Explanation:

Note from OpenSecret.org Center for Responsive Politics, quoted below:

NOTE: Figures on this page are calculations by the Center for Responsive Politics based on data from the Senate Office of Public Records. Data for the most recent year was downloaded on April 22, 2020 and includes spending from January 1 – March 31. Prior years include spending from January through December.

Interpretation

Annually the lobbying may increase or decrease depending on the federal government on how much attention they are giving their issues. 

 

7. TXN FINANCIAL STRENGTH

TXN FINANCIAL STRENGTH

DATA

Working capital $6,638,000,000
Total assets $18,018,000,000
Sales $14,118,000,000
EBIT $5,811,000,000
Market value of equity $106,526,000,000
Book value of total liabilities $9,111,000,000
Retained earnings $39,898,000,000

CALCULATION

Ratio Score Result
A – Working Capital / Total Assets 0.37 1.20 0.44
B – Retained Earnings / Total Assets 2.21 1.40 3.10
C – EBIT / Total Assets 0.32 3.30 1.06
D – Market Value of Equity / Book Value of Total Liabilities 11.69 0.60 7.02
E – Sales / Total Assets 0.78 1.00 0.78
Z-Score     12.41

Formula: Z-Score = 1.2A + 1.4B + 3.3C + 0.6D + 1.0E

Explanation:

Z-Score is a statistical measurement that compares data points from different sets of data to find correlations. This measurement by Dr. Edward Altman is a significant measure in determining the financial strength of the company because it relies on different weighted financial liquidity and profitability metrics to come up with the overall score. This measure indicates the probability of bankruptcy.

Interpretation

The calculated Z-Score of Texas Instruments Inc was 12.41. Dr. Altman’s grading scale of 3.0 and above indicates that the company will not declare bankruptcy in near future. In other terms, the company is not close to insolvency. The main factors of this statistical measurement are profitability, liquidity, leverage and efficiency. Texas Instruments has a strong financial health and is very far from insolvency.

Overview

Texas Instruments Inc is stable and healthy, the income statement shows that the company is profitable in the last five years of operations. The management is very efficient in generating sufficient and impressive revenue for its normal business operations in five years. The stock price of TXN is undervalued at the time this article was published and might be a good candidate for a Buy.

 

CITATION

http://www.ti.com/about-ti/company/history.html

https://www.morningstar.com/stocks/xnas/txn/quote

https://www.opensecrets.org/federal-lobbying/clients/summary?cycle=2019&id=D000000722

Researched and written by Criselda

Chevron Corp (CVX) Extended Graph Analysis

February 20th, 2020 Posted by Extended Analysis No Comment yet

Company Profile

CVX logo

Chevron Corporation is a public multinational energy corporation traded as NYSE:CVX, headquartered in San Ramon, California USA. Chevron and was founded on September 10, 1879. CVX is one of the largest oil companies as of 2019. The company produced fuel products, base oils and process oils, lubricants, chemicals, aviation fuels and marine fuels. The company is engaged in hydrocarbon exploration and production and refining. 

 

Chevron Corp (CVX) Extended Graph Analysis

1. CVX CASH FLOW

CVX CASH FLOW

2014 2015 2016 2017 2018 2019
Net cash flow provided by operating activities 31,475,000,000 19,456,000,000 12,846,000,000 20,515,000,000 30,618,000,000 30,808,000,000
Net cash provided by (used for) financing activities -4,999,000,000 2,815,000,000 25,000,000 -14,554,000,000 -13,699,000,000 -15,243,000,000
Net cash used for investing activities -29,893,000,000 -23,808,000,000 -16,852,000,000 -8,201,000,000 -12,290,000,000 -13,468,000,000
Capital expenditure -35,407,000,000 -29,504,000,000 -18,109,000,000 -13,404,000,000 -13,792,000,000 -13,897,000,000
Free cash flow -3,932,000,000 -10,048,000,000 5,263,000,000 7,111,000,000 16,826,000,000 16,911,000,000

Facts:

  • Net cash flow provided by operating activities were $30.8 billion in the trailing twelve months.
  • Net cash used for investing activities was -$13.5 billion in the trailing twelve months.
  • Cash provided by (used for) financing activities was -$15 billion in the trailing twelve months.
  • Capital expenditure was -$13.9 billion in the trailing twelve months.
  • Free cash flow was $16.9 billion in the trailing twelve months.

Explanation

  • Net income and depreciation have a significant amount in cash provided by operating activities.
  • Cash used for investing activities were investment in property, plant and equipment, and purchases of investment.
  • Cash provided by (used for) financing activities were debt issued and repayment, and dividend payments.
  • Capital expenditure is investment in property, plant and equipment.
  • Free cash flow had less one percent increase from 2018 to the trailing twelve months.

Interpretation

CVX was able to provide cash from operations in the last five years. Moreover, the company was able to generate a free cash flow from 2017 to the trailing twelve months.

 

2. CVX BALANCE SHEET

CVX BALANCE SHEET

2014 2015 2016 2017 2018 2019
Total cash 13,215,000,000 11,332,000,000 7,001,000,000 4,822,000,000 10,345,000,000 11,755,000,000
Current Assets 42,232,000,000 35,347,000,000 29,619,000,000 28,560,000,000 34,021,000,000 33,988,000,000
Net property, plant and equipment 183,173,000,000 188,396,000,000 182,186,000,000 177,712,000,000 169,207,000,000 164,363,000,000
Total non-current assets 223,794,000,000 230,756,000,000 230,459,000,000 225,246,000,000 219,842,000,000 222,549,000,000
Total assets 266,026,000,000 266,103,000,000 260,078,000,000 253,806,000,000 253,863,000,000 256,537,000,000
Current liabilities 31,926,000,000 26,464,000,000 31,785,000,000 27,737,000,000 27,171,000,000 30,233,000,000
Non-current liabilities 79,072,000,000 86,923,000,000 82,737,000,000 77,945,000,000 72,138,000,000 70,463,000,000
Total liabilities 110,998,000,000 113,387,000,000 114,522,000,000 105,682,000,000 99,309,000,000 100,696,000,000
Retained earnings 184,987,000,000 181,578,000,000 173,046,000,000 174,106,000,000 180,987,000,000 183,783,000,000
Stockholders equity 155,028,000,000 152,716,000,000 145,556,000,000 148,124,000,000 154,554,000,000 155,841,000,000

Facts:

  • Total cash was $11.8 billion in Q3 2019.
  • Current assets were $34 billion in Q3 2019.
  • Net property, plant and equipment was $164 billion in Q3 2019.
  • Total non-current assets were $223 billion in Q3 2019.
  • Total assets were $257 billion in Q3 2019.
  • Current liabilities were $30 billion in Q3 2019.
  • Non-current liabilities were $70 billion in Q3 2019.
  • Total liabilities were $107 billion in Q3 2019.
  • Retained earnings were $184 billion in Q3 2019.
  • Stockholders equity was $156 billion in Q3 2019.

Explanation

  • Total cash was erratic in movement in the last five years. It grows 14 percent from 2018. It represents 35 percent of current assets.
  • Current assets were erratic in movement in the last five years. It represents 13 percent of total assets.
  • Net property, plant and equipment represents 74 percent of total non-current assets.
  • Total non-current assets represents 87 percent of total assets.
  • Total assets grew 1 percent from 2018.
  • Current liabilities represent 30 percent of total liabilities.
  • Non-current liabilities represent 70 percent of total liabilities.
  • Total liabilities was 39 percent of total liabilities and stockholders equity.
  • Retained earnings was 118 percent of equity.
  • Stockholders equity represents 61 percent of total liabilities and shareholders equity.

Interpretation

The balance sheet is liquid. The company’s current assets are sufficient for its current obligations. CVX is using more of the shareholders investment than the sources from creditors in the usual business operations. In other words the shareholders have more stake than the creditors in the trailing twelve months.

3. CVX INCOME AND MARKET

CVX INCOME AND MARKET

2014 2015 2016 2017 2018 2019
Revenue 200,494,000,000 129,925,000,000 110,215,000,000 134,674,000,000 158,902,000,000 145,629,000,000
EBIT 19,726,000,000 -3,710,000,000 -6,216,000,000 2,480,000,000 14,446,000,000 13,295,000,000
Net Income 19,241,000,000 4,587,000,000 -497,000,000 9,195,000,000 14,824,000,000 13,264,000,000
Market Capitalization 211,347,120,000 169,378,000,000 222,190,000,000 237,783,000,000 207,010,000,000 202,588,000,000
Intrinsic Value 209,073,862,419 212,683,314,721 333,795,619,400 423,503,597,323 716,272,790,115 995,200,421,499

Facts:

  • Revenue was $146 billion in the trailing twelve months.
  • EBIT was $13 billion in the trailing twelve months.
  • Net income was $13 billion in the trailing twelve months.
  • The market capitalization was $202.588 billion in the trailing twelve months.
  • Intrinsic value was $995 billion in the trailing twelve months.

Explanation:

  • Revenue was erratic in movement. It was down 8 percent from 2018.
  • EBIT represents 9 percent of revenue in the trailing twelve months.
  • Net income was 9 percent of revenue in the trailing twelve months.
  • Market capitalization was erratic in movement in the last five years. It shows a decrease of 2 percent from 2018.
  • Intrinsic value was higher than the market capitalization by 3x in the trailing twelve months.

Interpretation

The company was able to generate sufficient revenue for the operation of the business in the trailing twelve months.

 

4. CVX FINANCIAL RATIOS

CVX FINANCIAL RATIOS

2014 2015 2016 2017 2018 TTM
Asset turnover (average) 0.77 0.49 0.42 0.52 0.63 0.57
Return on assets % 7.4 1.72 -0.19 3.58 5.84 5.17
Return on equity % 12.65 2.98 -0.33 6.26 9.8 8.57
Debt/Equity 0.15 0.22 0.24 0.23 0.19 0.16
Return on invested capital % 10.92 2.45 -0.2 5.02 8.17 7.31
Interest coverage 0 0 -9.75 31.04 28.51 24.25

Facts:

  • Asset turnover was averaging 0.57 in the trailing twelve months.
  • Return on asset was 5.17 percent in the trailing months.
  • Return on equity was $8.57 percent in the trailing twelve months.
  • Debt/Equity was 0.16 in the trailing twelve months.
  • Return on invested capital was 7.31 percent in the trailing twelve months.
  • Interest coverage was 24.25 in the trailing twelve months.

Explanation

  • Asset turnover indicates that for every dollar invested in assets, the company generates 57 cents of sales.
  • Return on asset indicates that for every dollar invested in assets, CVX generated 5.17 cents of net income.
  • Return on equity indicates that for every dollar of the capital that the shareholders invested, the company generates 8.57 cents profit.
  • Debt to Equity indicates that the company has $0.16 debt for every dollar of assets.
  • Return on invested capital indicates that the company generated a 7.31 percent return from the company’s investments.
  • The interest coverage indicates that the company has the ability to make interest payments on its debt in due date.

Interpretation

The company has the ability to generate cash for its daily business operations. CVX is using more of the investors money than creditors.

 

5. CVX KEY EXECUTIVE COMPENSATION

CVX KEY EXECUTIVE COMPENSATION

2014 2015 2016 2017 2018
Key Executive Compensation 44,239,015 46,489,214 57,690,075 64,632,139 55,846,538
John S. Watson/Chairman of the Board and Chief Executive Officer 25,970,417 22,029,809 24,657,491 24,781,568 1,241,499
Patricia E. Yarrington/Vice President and Chief Financial Officer 9,781,357 7,379,867 6,541,425 8,152,053 7,159,079
Michael K. Wirth/Vice Chairman of the Board and Executive Vice President, Midstream & Development 8,487,241 8,123,840 9,129,645 11,669,681 20,640,623
James William Johnson/Executive Vice President, Upstream 8,955,698 9,416,320 11,024,515 10,925,982
Pierre R. Breber/Executive Vice President, Downstream & Chemicals 8,030,044
Joseph C. Geagea/Executive Vice President, Technology, Projects and Services 7,945,194 9,004,322 7,849,411

Facts:

  • Total key executive compensation was $55,846,538 in 2018.
  • Chairman of the Board and CEO compensation was $1,241,499 in 2018.
  • Vice President and CFO compensation was $7,159,079 in 2018.
  • Vice Chairman of the Board and EVP Mainstream & Development compensation was $20,640,623 in 2018.
  • EVP Upstream compensation was $10,925,982 in 2018.
  • EVP Downstream and Chemicals compensation was $8,030,044 in 2018.
  • EVP Technology, Projects and Services compensation was $7,849,411 in 2018.

Explanation:

  • The key executive total compensation represents 0.38 percent of net income in 2018.
  • Chairman of the Board and CEO compensation represents 2 percent of the total key executive compensation.
  • Vice President and CFO compensation represents 13 percent of the total key executive compensation in 2018.
  • Vice Chairman of the Board and EVP Mainstream & Development compensation represents 37 percent of the total key executive compensation in 2018.
  • EVP Upstream compensation represents 20 percent of the total key executive compensation in 2018.
  • EVP Downstream and Chemicals compensation represents 14 percent of the total key executive compensation in 2018.
  • EVP Technology, Projects and Services compensation  represents 14 percent of the total key executive compensation in 2018.

Interpretation

The company is spending less than one percent of its net income in its key executive compensation.

 

6. CVX LOBBYING AND CONTRIBUTIONS

CVX LOBBYING AND CONTRIBUTIONS

PERIOD USD PERIOD USD
2019 9,270,000 2008 12,994,000
2018 9,600,000 2007 9,030,000
2017 9,290,000 2006 7,480,000
2016 7,470,000 2005 9,490,000
2015 7,200,000 2004 5,220,000
2014 8,280,000 2003 4,620,000
2013 10,530,000 2002 4,620,000
2012 9,550,000 2001 1,519,296
2011 9,510,000 2000 1,680,000
2010 13,130,000 1999 2,040,000
2009 20,815,000 1998 2,969,825

Explanation:

The company has been lobbying and contributions to politicians yearly since 1998. A note from Center for Responsive Politics were quoted below:

NOTE: Figures on this page are calculations by the Center for Responsive Politics based on data from the Senate Office of Public Records. Data for the most recent year was downloaded on January 23, 2020 and includes spending from January 1 – December 31. Prior years include spending from January through December.”

Interpretation

The company’s total lobbying and contributions in 2019 represents 0.07 percent of net income in 2019.

 

7. CVX FINANCIAL STRENGTH

CVX FINANCIAL STRENGTH

DATA USD
Working capital 6,850,000,000
Total assets 253,683,000,000
Sales 145,629,000,000
EBIT 13,295,000,000
Market value of equity 211,134,800,000
Book value of total liabilities 99,309,000,000
Retained earnings 180,987,000,000

 

CALCULATION

Ratio Score Result
A – Working Capital / Total Assets 0.0270 1.20 0.03
B – Retained Earnings / Total Assets 0.71 1.40 1.00
C – EBIT / Total Assets 0.05 3.30 0.17
D – Market Value of Equity / Book Value of Total Liabilities 2.13 0.60 1.28
E – Sales / Total Assets 0.57 1.0 0.57
Z-Score     3.05

 

Formula: Z-Score = 1.2A + 1.4B + 3.3C + 0.6D + 1.0E

 

Explanation:

Z-Score is a statistical measurement that compares data points from different sets of data to find correlations. This measurement by Dr. Edward Altman is a significant measure in determining the financial strength of the company because it relies on different weighted financial liquidity and profitability metrics to come up with the overall score. This measure indicates the probability of bankruptcy.

Interpretation

Chevron Corporation. has a Z-Score of 3.05. Dr. Altman’s grading scale of 3.0 and above indicates that the company will not declare bankruptcy in near future. In other terms, the company is not close to insolvency. The main factors of this statistical measurement are profitability, liquidity, leverage and efficiency.

Overview

The company is capable of producing sufficient revenue for the operation of the business and able to produce free cash flow in the last three years.

 

Citation

https://www.chevron.com/about

https://www.opensecrets.org/federal-lobbying/clients/summary?cycle=1998&id=D000000015

https://www.morningstar.com/stocks/xnys/cvx/quote

Researched and written by Criselda

Vestas Wind System A/S (VWS) Extended Graph Analysis

November 19th, 2019 Posted by Extended Analysis No Comment yet

About the Company

vestas

Vestas Wind System manufactures wind turbines around the world. Vestas is an energy industry that install and service wind turbines. The company has more than 108 GW wind turbines in 80 countries.

Vestas is a Danish company founded in 1945, headquartered in Hedeager 42 Aarhus N, 8200 Denmark with more than 25,000 employees  Vestas is under Energy Sector and under Renewable Energy Industry.

 

Vestas Wind System A/S (VWS) Extended Graph Analysis

 

1. VWS CASH FLOWS

VWS CASH FLOWS

2014 2015 2016 2017 2018 2019
Net cash provided by operating activities 1,126,000,000 1,472,000,000 2,181,000,000 1,625,000,000 1,021,000,000 1,357,000,000
Net cash used for investing activities -285,000,000 -425,000,000 -817,000,000 -407,000,000 -603,000,000 21,000,000
Net cash provided by (used for) financing activities 389,000,000 -360,000,000 -611,000,000 -974,000,000 -639,000,000 -249,000,000
Capital expenditure -278,000,000 -368,000,000 -489,000,000 -491,000,000 -607,000,000 -733,000,000
Free cash flow 848,000,000 1,104,000,000 1,692,000,000 1,134,000,000 414,000,000 624,000,000

Facts

  • Cash provided by operating activities was $1.357 billion in 2019.
  • Net cash used for investing activities was $21 million in 2019.
  • Net cash provided by (used for) financing activities was -$249 million in 2019.
  • Capital expenditure was -$733 million in 2019.
  • Free cash flow was $624 million in 2019.

Explanation

  • Cash from operation had a growth of 21 percent in five years.
  • Cash from investing activities, purchases of investments and other investing activities have a significant amount.
  • Cash from financing activities were common stock repurchases and dividend payment.
  • Capital expenditures are purchases of property, plant and equipment and purchase of intangibles.
  • Free cash flow although erratic in movement in the last five years, it has a positive results year-over-year.

Interpretation

The company managed to generate cash for the operation of the business. Its net income is sufficient to generate positive operating cash flow.

 

2. VWS BALANCE SHEET

VWS BALANCE SHEET

2014 2015 2016 2017 2018 2019
Total cash 1,819,000,000 2,569,000,000 3,226,000,000 3,204,000,000 3,308,000,000 3,308,000,000
Total current assets 4,696,000,000 5,976,000,000 6,950,000,000 8,006,000,000 8,555,000,000 8,555,000,000
Net property, plant and equipment 1,132,000,000 1,279,000,000 1,329,000,000 1,247,000,000 1,318,000,000 1,318,000,000
Total non-current assets 2,301,000,000 2,611,000,000 2,981,000,000 2,865,000,000 3,344,000,000 3,344,000,000
Total assets 6,997,000,000 8,587,000,000 9,931,000,000 10,871,000,000 11,899,000,000 11,899,000,000
Short-term debt 604,000,000 0 0 0 0 0
Total current liabilities 4,357,000,000 4,805,000,000 5,627,000,000 6,533,000,000 7,405,000,000 7,405,000,000
Long-term debt 3,000,000 495,000,000 496,000,000 497,000,000 498,000,000 498,000,000
Total liabilities 4,618,000,000 5,688,000,000 6,741,000,000 7,759,000,000 8,807,000,000 8,807,000,000
Total stockholders’ equity 2,379,000,000 2,899,000,000 3,190,000,000 3,112,000,000 3,092,000,000 3,092,000,000

Facts:

  • Total cash was $3.3 billion in 2018.
  • Current assets was $8.555 billion in 2018.
  • Net property, plant and equipment was $1.3 billion in 2018.
  • Non-current assets were $3.3 billion in 2018.
  • Total assets were $11.899 billion in 2018.
  • Short-term debt was zero from 2015 to 2018.
  • Current liabilities were $7.405 billion in 2018.
  • Long-term debt was $498 million in 2018.
  • Total liabilities were $8.807 billion in 2018.
  • Stockholders equity was $3.092 billion in 2018.

Explanation

  • Total cash increases year-over-year and has grown 82 percent in five years. Moreover, it represents 39 percent of total current assets.
  • Current assets increases year-over-year and has a growth of 82 percent in five years. Further, it represents 72 percent of total assets.
  • Net property, plant and equipment increased by 16 percent in five years. Further, it represents 39 percent of the total non-current assets.
  • Non-current assets grows 45 percent in five years and it represents 28 percent of the total assets in 2018.
  • Total assets increases year-over-year and has grown 70 percent in the last five years.
  • There was zero short-term debt in the last four years.
  • Current liabilities represents 84 percent of the total liabilities in 2018.
  • Long-term debt represents 6 percent of the total liabilities in 2018.
  • Total liabilities represents 74 percent of the total liabilities and stockholders equity in 2018.
  • Equity represents 26 percent of the total liabilities and total equity in 2018.  

Interpretation

The company has a strong balance sheet hence current assets is greater than its current liabilities which means that VWS is capable of paying its current obligations when due time comes.

3. VWS FINANCIAL RATIOS

VWS FINANCIAL RATIOS

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Asset Turnover (avg) 1.13 1.03 0.79 0.98 0.96 1.09 1.08 1.11 0.96 0.89 0.85
Return on Asset  % 9.86 2.31 -2.25 -13.14 -1.30 6.20 8.79 10.42 8.60 6.01 5.02
Return on Equity % 21.77 5.10 -6.23 -45.88 -5.21 20.09 25.96 31.70 28.37 22.05 20.74
Financial Leverage (avg) 1.91 2.57 2.98 4.30 3.70 2.94 2.96 3.11 3.49 3.85 4.37
Return on Invested Capital % 21.23 5.69 -2.23 -27.28 -0.77 16.17 21.59 27.28 24.53 19.15 17.08
Interest Coverage 14.05 3.53 -0.28 -11.08 0.58 15.94 49.68 50.50 80.47 42.36 0.00

Facts:

  • Asset turnover ratio was 0.85 in 2019.
  • Return on assets were 5.02 percent in 2019.
  • Return on equity was 20.74 percent in 2019.
  • Financial leverage was averaging 4.37 in 2019.
  • Return on invested capital was 17.08 percent in 2019.
  • Interest coverage were 42.36 and 0.00 in 2018 and 2019 respectively.

Explanation

  • Asset turnover means that a ratio of 0.85 indicate a dollar of asset generated 85 cents of net sales.
  • Return on assets indicates that every dollar invested in asset it generated 5.02 cents of net income.
  • Return on equity indicates that every dollar of shareholders equity VWS generates 20.74 cents of net income. 
  • Financial leverage means that for every dollar invested in equity the company generated $4.37 in total assets.Further, $3.37 was borrowed. Furthermore, it indicates that VWS starts to get risky.
  • Return on invested capital means that the company is making 17.08 percent over its invested capital. In other terms, for every dollar invested in capital the company generates 0.1708 cents.
  • Interest coverage means that the company has the ability to make interest payments on its debt when due date comes. In other words, the company is making sufficient money from current operations to pay for current interest rates.

Interpretation

Financial ratios shows that the company is operating well its business except in the area of asset turnover which needs a little improvement.

 

4. VWS INCOME AND MARKET

VWS INCOME AND MARKET

2014 2015 2016 2017 2018 2019
Sales 6,910,000,000 8,423,000,000 10,237,000,000 9,953,000,000 10,134,000,000 10,866,000,000
EBIT 558,000,000 859,000,000 1,421,000,000 1,230,000,000 959,000,000 898,000,000
Net Income 392,000,000 685,000,000 965,000,000 894,000,000 684,000,000 640,000,000
Market Capitalization 8,164,000,000 15,513,000,000 14,491,000,000 14,000,000,000 14,872,000,000 14,472,000,000
Intrinsic Value 7,635,146,286 26,442,872,224 15,639,413,893 24,227,525,567 50,141,478,405 15,344,024,990
EBITDA 935,000,000 1,249,000,000 1,718,000,000 1,628,000,000 1,390,000,000 871,000,000

Facts

  • Sales was $10.866 billion in 2019.
  • EBIT was $898 million in 2019.
  • Net income was $640 million in 2019.
  • Market capitalization was $14.472 billion in 2019.
  • Intrinsic value was $15.3 billion in 2019.
  • EBITDA was $871 million in 2019.

Explanation

  • Sales has a growth of 57 percent in five years.
  • EBIT increased by 61 percent in five years and it represents 8 percent of sales.
  • Net income grew 63 percent in five years and it represents 6 percent of sales.
  • Market capitalization increased by 77 percent in the last five years.
  • Intrinsic value was greater by 6 percent against market capitalization.
  • EBITDA decreased 7 percent in five years. It represents 8 percent of sales.

Interpretation

The company had not seen any negative bottomline in the last five years, although it decreases year-over-year from 2017 to 2019 at an average rate of 12 percent. 

 

5. VWS BOARD OF DIRECTORS COMPENSATION

VWS TOTAL BOARD OF DIRECTORS COMPENSATION

TOTAL COMPENSATION (in DKK)

2016 2017 2018
Bert Nordberg 2,100,000 2,200,000 2,143,353
Lard Josefsson 1,800,000 1,800,000 1,832,918
Carsten Bjerg 900,000 900,000 909,427
Eija Pitkanen 700,000 700,000 650,000
Henrik Andersen 500,000 1,100,000 1,100,000
Henry Stenson 700,000 700,000 483,888
Jens Hesselberg Lund 0 0 650,000
Kim Hvid Thomsen 700,000 700,000 650,000
Michael Abildgaard Lisbjerg 400,000 400,000 400,000
Peter Lindhoist 400,000 400,000 400,000
Sussie Dvinge Agerba 400,000 400,000 400,000
Torben Ballegaard 400,000 700,000 650,000

Facts:

  • Bert Nordberg total compensation was DKK 2.1 million in 2018.
  • Lard Josefsson total compensation was DKK 1.8 million in 2018.
  • Carsten Bjerg total compensation was DKK 909 thousand in 2018.
  • Eija Pitkänen total compensation was DKK 650 thousand in 2018.
  • Henrik Andersen total compensation was DKK 1.1 million in 2018.
  • Henry Stenson total compensation was DKK 483,888 in 2018.
  • Jens Hesselberg Lund total compensation was DKK 650,000 in 2018.
  • Kim Hvid Thomsen total compensation was DKK 650,000 in 2018.
  • Michael Abildgaard Lisbjerg total compensation was DKK 400 thousand in 2018.
  • Peter Lindhoist total compensation was DKK 400 thousand in 2018.
  • Sussie Dvinge Agerbo total compensation was DKK 400 thousand in 2018.
  • Torben Ballegaard total compensation was DKK 400 thousand in 2018.

Explanation

  • Bert Nordberg compensation represents 21 percent of the total compensation in 2018.
  • Lard Josefsson compensation represents 18 percent of the total compensation in 2018.
  • Carsten Bjerg compensation represents 9 percent of the total compensation in 2018.
  • Eija Pitkanen compensation represents 6 percent of the total compensation in 2018.
  • Henrik Andersen compensation represents 11 percent of the total compensation in 2018.
  • Jens Hesselberg Lund compensation represents 6 percent of the total compensation in 2018.
  • Kim Hvid Thomsen compensation represents 6 percent of the total compensation in 2018.
  • Michael Abildgaard Lisbjerg compensation represents 4 percent of the total compensation.
  • Peter Lindhoist compensation represents 4 percent of the total compensation in 2018.
  • Sussie Dvinge Agerbo compensation represents 4 percent of the total compensation in 2018.
  • Torben Ballegaard compensation represents 6 percent of the total compensation in 2018.

Interpretation

The total board of directors compensation represents 1.6 percent of the net income in 2018.

 

6. LOBBYING AND CONTRIBUTIONS

VWS LOBBYING AND CONTRIBUTIONS

 

TOTAL LOBBYING EXPENDITURES
Period USD
2008 210,000
2009 150,000
2010 325,000
2011 310,000
2012 480,000
2013 220,000
2014 270,000
2015 270,000
2016 180,000
2017 540,000
2018 390,000
2019 250,000

Facts:

  • Total lobbying expenditures in 2008 was $210 thousand.
  • Total lobbying expenditures in 2009 was $150 thousand.
  • Total lobbying expenditures in 2010 was $325 thousand.
  • Total lobbying expenditures in 2011 was $310 thousand.
  • Total lobbying expenditures in 2012 was $480 thousand.
  • Total lobbying expenditures in 2013 was $220 thousand.
  • Total lobbying expenditures in 2014 was $270 thousand.
  • Total lobbying expenditures in 2015 was $270 thousand.
  • Total lobbying expenditures in 2016 was $180 thousand.
  • Total lobbying expenditures in 2017 was $540 thousand.
  • Total lobbying expenditures in 2018 was $390 thousand.
  • Total lobbying expenditures in 2019 was $250 thousand.

Explanation

The company is spending a yearly lobbying from 2008 to 2019.  A statement from OpenSecret stated that, all lobbying expenses report came from the Senate Office of Public Records. The data for the most recent years was downloaded on September 19, 2019.

 

7. VWS FINANCIAL STRENGTH

VWS FINANCIAL STRENGTH

DATA:

EUR
Working capital 1,150,000,000
Total assets 11,899,000,000
Sales 10,866,000,000
EBIT 959,000,000
Market value of equity 14,472,000,000
Book value of total liabilities 8,807,000,000
Retained earnings 3,042,000,000

CALCULATION

Ratio Score Result
A – Working Capital / Total Assets 0.10 1.20 0.12
B – Retained Earnings / Total Assets 0.26 1.40 0.36
C – EBIT / Total Assets 0.08 3.30 0.27
D – Market Value of Equity / Book Value of Total Liabilities 1.64 0.60 0.99
E – Sales / Total Assets 0.91 1.0 0.91
Z-Score 2.64

Formula: Z-Score = 1.2A + 1.4B + 3.3C + 0.6D + 1.0E

Explanation

Z-Score is a statistical measurement that compare data points from different sets of data to find correlations. This measurement by Dr. Edward Altman is a significant measure in determining the financial strength of the company because it relies on different weighted financial liquidity and profitability metrics to come up with the overall score. This measure indicates the probability of bankruptcy.

Interpretation

The result of the calculated Z-Score of VWS was 2.64. Dr. Edward Altman indicate that a grading scale of 1.8 to 3 tells us that the company will likely declare bankruptcy in the near future.

There are four main categories in the calculation of Z-Score namely, the profitability or the return on investment, liquidity, leverage and the operating or efficiency.

Hence this calculation relies on different metrics this is a significant measure in determining the financial strength of the company.

CITATION

https://www.vestas.com/

https://www.opensecrets.org/federal-lobbying/clients/summary?cycle=2019&id=F318846

Researched and written by Criselda

 

 

 

 

Note:

Research Reports can be found under the company tab.