Question
I need to find VRL's economic value added in the 2018/2019 financial year and compare it with the previous year. EVA = NOPAT - Invested
I need to find VRL's economic value added in the 2018/2019 financial year and compare it with the previous year. EVA = NOPAT - Invested capital * WACC
NOPAT = 38.12 million
Invested Capital = 952.15 million
WACC = -3.7%
Therefore,
EVA = 38.12 - 952.15 * -0.037
EVA = 73.35 million
This is the answer I have found however I don't understand what this 73.35 million means?? Why is the number increasing shareholder wealth when the WACC is negative?
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Investments An Introduction
Authors: Herbert B Mayo
9th Edition
324561385, 978-0324561388
