Market value added
What is market value added?
Market value added (MVA) shows the contrast between the present market value of a company and the capital that has been added by investors. If the market value added is positive, the company has gained value. If the market value added is negative it has destroyed value.
Where have you heard about market value added?
If an investor is interested in contributing to a company, the first thing they will take into consideration is the company’s market value added. This shows how well they do for their shareholders as it’s indicative of how able it is to increase its shareholder value over time.
What you need to know about market value added.
Investors tend to be attracted to companies with a high or positive market value because they are more able to create positive returns. A positive MVA also displays a good level of governance and strong leadership – qualities which are attractive to investors, shareholders and employees alike. Current and past high performance levels show shareholders and investors that a company is able to achieve and succeed for a sustained amount of time. Coca Cola is an example a company who increase their market value annually (for the last 25 years) and have an effective management style.