Cash Value Added - CVA

DEFINITION of 'Cash Value Added - CVA'

A measure of the amount of cash generated by a company through its operations. It is computed by subtracting the 'operating cash flow demand' from the 'operating cash flow' from the cash flow statement.

BREAKING DOWN 'Cash Value Added - CVA'

Cash value added is similar to economic value added but takes into consideration only cash generation as a opposed to economic wealth generation. This measure helps give investors an idea of the ability of a company to generate cash from one period to another. Generally speaking, the higher the CVA the better it is for the company and for investors.

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RELATED FAQS
  1. Why should fundamental investors pay attention to Cash Value Added (CVA)?

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  3. Are taxes calculated in operating cash flow?

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  4. How is cash flow from operating activities calculated?

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  5. What are some examples of how cash flows can be manipulated or distorted?

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