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- Title
IS ECONOMIC VALUE ADDED SUPERIOR TO EARNINGS AND CASH FLOWS IN EXPLAINING MARKET VALUE ADDED? AN EMPIRICAL STUDY.
- Authors
Obaidat, Ahmad N.
- Abstract
This study investigates if Economic Value Added (EVA) is superior to Net Operating Profit after Tax (NOPAT) and Net Cash Flow (NCF) in explaining the change in the Market Value Added (MVA) of the non-financial firms listed on Amman Stock Exchange (ASE) for the year 2016. The results indicated that NCF has the strongest power in explaining the change in MVA, followed by EVA. The results also indicated that the NOPAT does not add any additional significant explanatory power to NCF and EVA in explaining the change in MVA. Finally, this study recommends the use of EVA as an enhancement tool to the existing traditional accounting performance measures, not as a substitute to them.
- Publication
International Journal of Business, Accounting & Finance, 2019, Vol 13, Issue 1, p57
- ISSN
1936-699X
- Publication type
Academic Journal