HP-12C EVA Project
Computes EVA Economic Value Added of project by HP-12C residual profit over capital with WACC.
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HP-12C EVA — Economic Value Added
EVA measures how much value a business creates beyond what its capital costs: EVA = NOPAT - (Capital Investido × WACC). When EVA comes out positive, value was created; when it's negative, value was destroyed, and that can happen even with a positive accounting profit. Stern Stewart & Co. trademarked the concept in the 1980s, and plenty of Fortune 500 firms tie executive pay to it.
A few real-world figures: AmBev has historically run an EVA of R$ 3-5 bi/ano, while Vale's swings around depending on the commodity. You can also write it as ROIC × Capital - WACC × Capital = EVA. It shows up in the CFA Level 2 corporate material and in Stern Stewart's "The EVA Challenge" (2001).
Applications
Setting executive pay with bonuses tied to EVA, deciding where to allocate capital, judging how each division performs, and sizing up the synergies in an M&A deal.
FAQ
Diferença NOPAT vs lucro líquido? NOPAT = EBIT × (1-t), ou seja, o resultado puramente operacional, sem juros nem itens não-recorrentes.
EVA pode ser negativo com lucro? Pode. Se o ROIC fica abaixo do WACC, o capital destrói valor mesmo que o lucro contábil seja positivo.
EVA vs MVA? O MVA é a soma dos EVA descontados (Σ EVA), o valor de mercado adicional que fica acima do capital investido.
Related Tools
Market Value Added (MVA)
Computes the Market Value Added (MVA): the difference between a company's total market value and the capital investors put into it. It measures how much wealth management has created (or destroyed) above the money invested — a positive MVA means the market values the company at more than it cost to build. It's the long-run counterpart of EVA, which measures value creation year by year. Enter the market value and the invested capital.
HP-12C WACC Company
Computes WACC Weighted Average Cost of Capital by HP-12C with debt and equity proportions.
HP-12C Dividend Yield
Computes Dividend Yield of typical Brazilian stock by HP-12C dividends over share price.
HP-12C ROIC Investment
Computes ROIC Return on Invested Capital of project by HP-12C net profit over capital.
HP-12C DFL Leverage
Computes DFL Degree of Financial Leverage by HP-12C operating profit over net profit.
HP-12C DOL Leverage
Computes DOL Degree of Operating Leverage by HP-12C contribution margin over operating profit.
The results provided by this tool are for general informational and educational purposes only and do not constitute professional, financial, medical, legal, tax or accounting advice. Always confirm important decisions with a qualified professional and official sources.