Invested Capital

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Dictionary Says

Definition of 'Invested Capital'

The total amount of money that was endowed into a company by the shareholders, bondholders and all other interested parties. Invested capital is often determined by adding the total debt and lease obligations to the amount of equity in the firm and then subtracting the non-operating cash and investments. Invested capital must be calculated, and there are multiple ways to calculate this figure. It will not be listed on the company's financial statement.

Investopedia Says

Investopedia explains 'Invested Capital'

Companies must earn more than it costs them to use the invested capital provided by bondholders, shareholders and other financing sources, in order to earn an economic profit. Knowing a company's invested capital allows investors to use this metric to calculate measures of performance such as return on invested capital, economic value added and return on capital employed.

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'Invested Capital'

  • EVA: Calculating Invested Capital | Investopedia

    http://www.investopedia.com/university/EVA/EVA3.asp
    Calculating invested capital is an important step in finding economic profit.
    Learn more here. ... EVA: Calculating Invested Capital. ...

  • Profitability Indicator Ratios: Return On Capital Employed ...

    http://www.investopedia.com/university/ratios/profitability-indicator/ratio5.asp
    ... Second, the concept behind the terms return on invested capital (ROIC) and return
    on investment (ROI) portends to represent "invested capital" as the source ...

  • EVA: What Does It Really Mean? | Investopedia

    http://www.investopedia.com/university/EVA/EVA5.asp
    ... Once we have NOPAT, we need only to subtract the capital charge, which is equal
    to total invested capital - which we find by making appropriate adjustments to ...

  • Find Quality Investments With ROIC

    http://www.investopedia.com/articles/fundamental/03/050603.asp
    Return on invested capital is a great way to measure the true value produced by
    a company. ... ROIC = Net Operating Profits After Tax (NOPAT) / Invested Capital. ...

  • EVA: Overview | Investopedia

    http://www.investopedia.com/university/EVA/EVA1.asp
    ... The only difference is that, under economic profit, the intrinsic value of the firm
    is broken into two parts: invested capital, plus the present value of ...

  • AmBev Brewery Is Chugging Ahead Of Its Peers

    http://stocks.investopedia.com/stock-analysis/2011/AmBev-Brewery-Is-Chugging-Ahead-Of-Its-Peers-ABV-BUD-FMX-SAM-TAP0919.aspx
    ... Return on Invested Capital (TTM). AmBev (NYSE:ABV). 26.6%. ... 7.0%. Return on Invested
    Capital Here is where it becomes apparent why I believe AmBev is a better buy ...

  • Spotting Profitability With ROCE

    http://www.investopedia.com/articles/stocks/05/010305.asp
    ... more insight, see Competitive Advantage Counts.). Because ROCE measures profitability
    in relation to invested capital, ROCE is important for capital-intensive ...

  • What is the difference between economic value added and market ...

    http://www.investopedia.com/ask/answers/06/economicvsmarketvalueadded.asp
    ... can be calculated by taking a company's net after-tax operating profit and subtracting
    from it the product of the company's invested capital multiplied by its ...

  • The 4 R's Of Investing In Retail

    http://www.investopedia.com/articles/stocks/10/the-four-rs-of-retail.asp
    ... Return on Invested Capital Moving from the big picture company-wide to the front
    line individual store operations for a moment, the second R in retail makes ...

  • Greenblatt's Little Book Loves McGraw-Hill

    http://stocks.investopedia.com/stock-analysis/2011/Greenblatts-Little-Book-Loves-McGraw-Hill-MHP-NWS-TRI-PSO0401.aspx
    ... (Learn more in Value Investing Using The Enterprise Multiple.) Return on Invested
    Capital The traditional ... Company. Return on Invested Capital. Earnings Yield. ...

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