The discount factor of a company is the rate of return that a capital expenditure project must meet to be accepted. It is used to calculate the net present value of future cash flows from a project ...

A discounted cash flow, or DCF, analysis measures the value of a business or project, such as a new factory for your small business. This value equals the sum of all of the project's future annual ...

Here's how to calculate the present value of a perpetual annuity that promises to pay flat or growing annual payments with helpful examples. A perpetual annuity, also called a perpetuity, promises to ...

Residual value is the estimated value of an asset at the end of its useful life. It's used to figure out things like the value of a car at the end of a lease or how much equipment is worth after it's ...

Warren Buffett and Charlie Munger explain how to calculate intrinsic value, a crucial element of Buffett’s value investing strategy. Learn about long-term investment and future cash flows.

The carrying value of a bond refers to its face value, plus any unamortized premiums or minus any unamortized discounts. We can quickly calculate a bond's carrying value with only a few pieces of ...

Lifetime value (LTV) is a significant metric that helps estimate the growth of a company. By comparing LTV to customer acquisition cost, the results can help make crucial decisions. This might include ...

Shareholder value is the return of an investment in a given company. Shareholder value is created when a company's returns exceed its cost of doing business. When a company's management team employs ...

Your car starts to depreciate once you drive it off the dealership and will continue to lose its value over the years. However, the value significantly drops after an accident, even if you get the ...

Par value is an arbitrary low value assigned to shares to meet legal requirements. To compute par value of issued shares, multiply the number per share by total shares. Low par value reduces financial ...