How to Use Economic Value Added Calculator
The Economic Value Added Calculator answers a simple question: does the business earn more than its cost of capital? Enter NOPAT, invested capital and WACC. The Economic Value Added Calculator shows the resulting EVA and the spread between ROIC and WACC.
- Pick a currency.
- Enter NOPAT.
- Enter invested capital — debt + equity capital deployed in operations.
- Enter WACC as a percentage.
Formula & Theory — Economic Value Added Calculator
The Economic Value Added Calculator uses Stern Stewart’s classic definition:
EVA = NOPAT - (Invested Capital × WACC)
Capital Charge = Invested Capital × WACC
ROIC = NOPAT / Invested Capital
EVA Spread = ROIC - WACC| Symbol | Meaning |
|---|---|
| NOPAT | Net operating profit after tax |
| Invested Capital | Operating capital base |
| WACC | Weighted average cost of capital |
Assumptions and Limits
The Economic Value Added Calculator assumes NOPAT and invested capital have been adjusted for accounting distortions (R&D, leases, goodwill).
Use Cases for Economic Value Added Calculator
- Performance measurement — connect bonuses to value creation.
- Investment decisions — evaluate project returns against WACC.
- Equity research — supplement DCF with EVA insight.
- Board reporting — communicate economic profit, not accounting profit.