Alcoa Enterprise Value vs Invested Capital Analysis

AA -- USA Stock  

USD 42.63  0.20  0.47%

Alcoa financial indicator trend analysis is way more than just evaluating Alcoa prevailing accounting drivers to predict future trends. We encourage investors to analyze account correlations over time for multiple indicators to determine whether Alcoa is a good investment. Please check the relationship between Alcoa Enterprise Value and its Invested Capital accounts. Check also Trending Equities.

Enterprise Value vs Invested Capital

Accounts Relationship

Enterprise Value vs Invested Capital

Significance: Pay attention

Overlapping area represents amount of trend that can be explained by analyzing historical patterns of Alcoa Enterprise Value account and Invested Capital

Correlation Coefficient

-0.81
Relationship DirectionNegative 
Relationship StrengthSignificant

Enterprise Value

Enterprise Value (or EV) is usually referred to as Alcoa theoretical takeover price. In the event of an acquisition, an acquirer would have to take on Alcoa debt, but would also pocket its cash. Enterprise Value is more accurate representation of Alcoa value then its market capitalization because it takes into account all of Alcoa Corporation existing debt. Enterprise value is a measure of the value of a business as a whole; calculated as Market Capitalization plus Total Debt USD minus Cash and Equivalents USD.

Invested Capital

Invested capital represents the total cash investment that shareholders and debt holders have contributed to Alcoa Corporation. There are two different methods for calculating Alcoa invested capital: operating approach and financing approach. Understanding ##company1# invested capital allows investors to calculate measures of performance such as return on invested capital or return on capital employed. Invested capital is an input into the calculation of Return on Invested Capital; and is calculated as: Total Debt plus Total Assets minus Goodwill and Intangible Assets minus Cash and Equivalents minus Current Liabilities. Please note this calculation method is subject to change.

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