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EVA(TM) (economic value added) is a measure of financial performance that combines the old concept of residual income with principles of modern corporate finance--specifically, that all capital has a cost and that earning more than the cost of capital creates value for shareholders.
Companies that generate high EVA are top performers that are highly valued by shareholders.
To make EVA work for your company, take three steps and follow four rules that have worked for a wide range of companies during the past 10 years.
STEP 1: Understand EVA.
EVA is the dollar value created for investors over a set period of time, like a quarter or a year. The value added is any excess of after-tax operating profit minus all the costs of doing business, including the interest cost of debt and the opportunity cost of equity. in other words, EVA is after-tax operating profits, less a capital charge equal to the amount of profit needed to cover interest expense and provide an adequate return for......

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Approximate Pages: 9 (250 words per double-spaced page)

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