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. What is the difference between Economic Value Added (EVA) and Market Value Added ...

    There are numerous ways that investors and lenders can estimate the valuation of a company. This becomes increasingly important ... Read Full Answer >>
  2. Why should fundamental investors pay attention to Cash Value Added (CVA)?

    Cash value added (CVA) can help fundamental investors evaluate how well a company can meets its cash flow needs over time. ... Read Full Answer >>
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    A liquid asset is cash on hand or an asset that can be readily converted to cash. An asset that can readily be converted ... Read Full Answer >>
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