Year: 1997
Type: article
Abstract: Economic Value Added (EVA), a tool for creating wealth, is a leading idea in corporate finance today. Highly regarded companies like Coca-Cola and CSX have seen their market value soar since adopting EVA. The concept is straightforward; value is created when earnings exceed the cost of invested capital. Thus, EVA is rapidly gaining acceptance among large, publicly-traded corporations. However, EVA can be applied effectively to create value in small, privately-held firms, too. This article illustrates EVA's application in small, privately-held firms, examines EVA "s strengths and weaknesses, discusses ways to overcome those weaknesses, and describes specific operating, investing and financing actions small business managers can take to create wealth.
Institution: James Madison University
Language: English
Subfield: Strategy and Management
Domain: Social Sciences
Open Access status: diamond
OpenAlex ID: W2181741050