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Экономическая Добавленная Стоимость И Дисконтированный Денежный Поток: Сопоставление Методов Управления Стоимостью
[Economic Value Added V. Discounted Cash Flow: Value-Based Management Methods Compared]

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Abstract

This article provides an analysis of the comparative possibilities of using economic value added (EVA) and net present value (NPV) to manage the value of a firm. Consideration of this is-sue is based on the concept of VBM - Value Based Management - management based on value. Methods for determining EVA and comparing the results of cost estimation are considered. The re-lationship between economic value added and NPV is expressed. The results of an empirical study on the relationship between the market value of the company, the return on invested capital and the growth rate are presented. The conditions are listed under which the equality of estimates made by discounting cash flows and EVA is ensured. The results of simulation modeling are presented for the case when the relationship between growth rates, reinvestment and return on capital is not pre-served.

Suggested Citation

  • Salmanov, Oleg, 2013. "Экономическая Добавленная Стоимость И Дисконтированный Денежный Поток: Сопоставление Методов Управления Стоимостью [Economic Value Added V. Discounted Cash Flow: Value-Based Management Methods Comp," MPRA Paper 112336, University Library of Munich, Germany, revised 01 Sep 2013.
    • Handle: RePEc:pra:mprapa:112336
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    More about this item

    Keywords

    Economic value added; EVA; net present value; NPV; free cash flow; growth rate; cost management.;
    All these keywords.

    JEL classification:

    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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