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Market value added (MVA) is the difference between the current market value of a firm and the capital contributed by investors. If MVA is positive, the firm has added value. If it is negative, the firm has destroyed value. The amount of value added needs to be greater than the firm's investors could have achieved investing in the market portfolio, adjusted for the leverage (beta coefficient) of the firm relative to the market.

Basic formula[edit]

The formula for MVA is:

 MVA = V - K

where:

  • MVA is market value added
  • V is the market value of the firm, including the value of the firm's equity and debt
  • K is the capital invested in the firm

MVA is the present value of a series of EVA values. MVA is economically equivalent to the traditional NPV measure of worth for evaluating an after-tax cash flow profile of a project if the cost of capital is used for discounting.

References[edit]

  • G. Bennett Stewart III, The Quest for Value (HarperCollins, 1991).

Original courtesy of Wikipedia: http://en.wikipedia.org/wiki/Market_value_added — Please support Wikipedia.
This page uses Creative Commons Licensed content from Wikipedia. A portion of the proceeds from advertising on Digplanet goes to supporting Wikipedia.

209 news items

Bloomberg

Bloomberg
Mon, 22 Jun 2015 17:19:08 -0700

Japanese stocks jumped, with the Topix index rising the most in more than four months, amid optimism a deal between Greece and its creditors will be reached. Toyota Motor Corp., the world's biggest carmaker by market value, added 2.2 percent as the yen ...

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Wed, 24 Jun 2015 10:15:00 -0700

The materials sub-index, which includes mining shares, gained 0.5 percent even as gold edged lower. Goldcorp (TSE:G), Canada's largest gold miner by market value, added 2.3 percent to C$20.93. Barrick Gold (TSE:ABX), the second-largest, inched up 0.1 ...
 
MarketWatch
Fri, 12 Jun 2015 14:33:45 -0700

Focus Graphite is devoting all resources to achieve its objective to put Lac Knife into production, and then to bring to market value-added products for the Lithium-ion battery sector and we cannot accept to let any distraction interfere with this ...
 
AllAfrica.com
Wed, 17 Jun 2015 14:45:00 -0700

It can also be defined as a market-focused collaboration among different stakeholders who produce and market value-added products. Value chain analysis is essential to an understanding of markets, their relationships, the participation of different ...
 
PR Newswire (press release)
Thu, 28 Aug 2014 03:30:00 -0700

Companies active in the mobile VAS market (value added services) and discussed in this report include America Movil, Apple, AT&T, BlackBerry, CanvasM Technology, Comviva Technology, Google, InMobi, KongZhong, OnMobile, One97 Communications, ...
 
Business Standard
Mon, 17 Dec 2012 08:40:37 -0800

The Coconut Development Board (CDB) is planning to explore markets for seven coconut-based products through 63 cities under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM). The basket includes packaged tender coconut water, virgin ...
 
The Globe and Mail
Mon, 08 Dec 2014 16:24:04 -0800

Market value added divided by market value (MVA/MV), a ratio that helps determine whether the invested capital is working properly. The market value-added is the difference between the market value of a company and the capital that was invested in it.
 
Seeking Alpha (registration)
Tue, 10 Feb 2015 01:22:30 -0800

Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. (More...)The author wrote this article themselves, and it expresses their own opinions. The author is not receiving ...
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