Economic value added and market value added: A simple version and application

Abstract

The current search for operational criteria and tests of firm performance is largely focused on the Economic Value Added (EVA) framework. While reasserting the essential soundness of this approach the paper seeks to improve its application by proposing a version of EVA which anchors the opportunity cost of equity capital on market rather than book values. The case for this is argued on general grounds and the resulting model is convenient for examining the possible effects of the gearing factor. The practicability of the model is illustrated by applying the proposed 'EVA' formula to a mixed set of accounting and stock market data from a sample of UK companies.

EVA® and other Arthurian myths: A comment on Zafiris & Bayldon (2000).

“…Surely, standing aside from the cut-and-thrust of the corporate environment academics can bring intellect, accumulated knowledge and a critical eye to such a problem. This is what Zafiris and Bayldon (2000) fails conspicuously to do.…”

Correlación entre resultados contables y generación de valor económico de un grupo empresarial colombiano

“…Por su parte, Zafiris & Bayldon (1999) reafirman la solidez esencial de los modelos EVA y MVA, plantean que son conveniente para examinar la viabilidad organizacional, en razón a que aplican un conjunto mixto de datos, es decir, utilizan datos internos de la organización representados en los estados financieros (datos contables) y datos del mercado bursátil. Para estos autores estos dos modelos representan un avance sobre la contabilidad convencional que puede ser resumida en el reconocimiento adecuado de los costos de oportunidad de todo el capital invertido en una empresa, eliminando así el peligro de mal uso y desperdicio de recursos de capital.…”

The Use of Economic Value Added as a Benchmark for Evaluating the Performance of Agricultural Companies Listed in the Iraqi Stock Exchange for 2010-2015

“…What makes EVA unique is the fact that it differs from profit but only concerned about the factors affecting and to determine shares' value in accordance with the wealth of the shareholders. The profits is expected to be obtained from a given project over its lifetime along with the risks and uncertainties associated with achieving these profits through the changes that occur from the volume of future flows of cash (Zafiris, & Bayldon, 1999).…”