Alcoa Invested Capital vs Enterprise Value Analysis

AA -- USA Stock  

Fiscal Quarter End: December 31, 2019  

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 Invested Capital and its Enterprise Value accounts. Check also Trending Equities.

Invested Capital vs Enterprise Value

Accounts Relationship

Invested Capital vs Enterprise Value

Significance: Significant Contrarian Relationship

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

Correlation Coefficient

-0.47
Relationship DirectionNegative 
Relationship StrengthVery Weak

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: [Debt] plus [Assets] minus [Intangibles] minus [CashnEq] minus [LiabilitiesC]. Please note this calculation method is subject to change.

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 than 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 [MarketCap] plus [DebtUSD] minus [CashnEqUSD].
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