Correlation study between the generation of economic value added (EVA) and market value added (MVA) for companies on the Colombian Stock Exchange during the period 2016-2021

10.21158/01208160.n94.2023.3748
Published 2023-10-02
Scientific articles

Abstract

This research has analyzed the relationship between the Economic Value Added (EVA) and the Market Value Added (MVA). These indicators have been used as a measure of business performance in terms of value generation. This framework has been developed through a quantitative study, using correlational analysis as a tool. For the development of this, it has been used as a dependent variable, the Added Market Value and as an independent variable, the Added Economic Value, based on the financial information of 29 Colombian companies that are listed in the stock market for the period between 2016 and 2021. To calculate the two indicators mentioned, the weighted average cost of capital, the return on invested capital and the operating profit after taxes have been used. The result of the study suggests that there is a positive and significant correlation between EVA and MVA, similar to previous studies carried out for companies from other countries. Likewise, for the Colombian case, it is true that the MVA turns out to be the present value of the EVA, when it is discounted at the rate of the weight average cost of capital WACC.

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