As mentioned earlier, corporate value can be represented by the price-book value ratio in a way whereby accounting value (equity book value) accounts for PBR equivalent to 1 and market value added
indicates PBR above 1, representing value creation over nominal book value (net assets).
1998), Hall and Brummer (1999), Hall (2013) indicate EVA's supremacy over traditional performance measures in terms of its association with market value added
Talebnia and Shoja (2011) investigated the relation between market Value Added
(MVA) to earnings ratio and economic value added (EVA) To earnings ratio in companies listed on Tehran Stock Exchange over the period 2003 to 2007.
It has created the highest market value added
during 2003-4 and 2005-6.
MVA, or market value added
, is the most objective measure of corporate performance.
This measure is referred to as the Relative Market Value Added
Using its calculation of market value added
(MVA), a measure of long-term wealth creation for shareholders over time, the performance gap was even more marked.
Management should aim to maximize the dollar amount by which the company's market value exceeds the capital supplied by the firm's investors-- hence the name market value added
These outcomes include better profitability, a higher market value added
(the Stern Stewart metric), a superior reputation (the Fortune survey), and excellent human resources experiences.
The ultimate performance scorecard, standardized Market Value Added
(MVA) rankings show which rainmaking CEOs have done well by their investors-- and which might more aptly be dubbed wealth destroyers.