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# MVA Calculator

What is market value added (MVA)?How to calculate MVA in financeFAQs

With this MVA calculator, you will be able to calculate the value a company is creating for its shareholders.

## What is market value added (MVA)?

Market value added (MVA) is a financial metric that calculates the difference between the total market value of a company and the amount of capital that has been invested in the company over time. The concept of MVA is based on the idea that the ultimate goal of any company is to create value for its shareholders, and that value can be measured by the market value of the company's stock.

MVA is a powerful tool for investors, managers, and analysts who want to evaluate a company's performance and its ability to create value for shareholders. A positive MVA indicates that a company is creating value for its shareholders, while a negative MVA indicates that the company is destroying value.

## How to calculate MVA in finance

To understand how to calculate MVA in finance, let's take Company Alpha as an example:

• Company name: Company Alpha
• Current market value: $1,000,000 • Capital invested:$700,000
• Current stock price: $20 • Number of shares outstanding: 50,000 Calculating MVA requires three steps: 1. Compute the current market value of the company First, you need to calculate the company's market value, which is the total value of the company's outstanding shares. This can be calculated by multiplying the current stock price by the number of outstanding shares. You can check out our market capitalization calculator to understand more about this topic. Company Alpha's current market value is $20 × 50,000 = $1,000,000. 2. Determine the capital invested The second step is to calculate the total capital invested in the company over time. This includes the initial capital investment plus any additional investments made by shareholders. The capital invested in this company is $700,000.

MVA = current market value - capital invested