Enterprise Valuation Research Based On EVA Perspective

In the high-speed continuous development of capital markets, corporateperformance has always been the focus of attention. The ultimate goal of the listedcompanies is to maximize shareholder wealth, which requires corporate performanceshould be accurate representation of the value created for shareholders. Therefore, thekey to business performance assessment is that the value of the business growth andthe number of the growth. Effective performance appraisal is based on fair andreasonable enterprise value evaluation index, which drives the manager’s valuecreation activities.This article summarized the conditions of use and limitations of the traditionalperformance evaluation system of the chinese enterprises engaged, and it pointed outthat the traditional accounting profit-based approach ignores the recognition andmeasurement of the cost of equity capital, and that "the principle of prudence" makesthe accounting treatment tend to be conservative, and that one-sided emphasis onprofits will no doubt induce operators to stimulate short-term profit, which is notconducive to sustained and stable development of the corporate health. On this basis,This article indtroduces the theroy and model of Economic Value Added (EVA): EVAzero-growth model, EVA fixed-growth model and EVA two-stage growth model, andthe improvement of created EVA valuation by illustrating a case, which helps improveour value evaluation system.This article uses the method of combining theoretical analysis and empiricalresearch, doing reserch about EVA valuation model application. Use the framework ofthe model in Henan Shenhuo Group Leader Co., Ltd., test to assess the effect of thepractical application of the framework.This article is divided into three parts. The first is theoretical part, including thefirst chapter, the second and third chapters; the second is the empirical analysissection, including the third and fourth. The third is conclusion.The first chapter is the Introduction, including the background and significance, introduces the thesis, literature review; current research status of the corporateperformance assessment; the framework of this paper.The second chapter is related theory, including comparative analysis of thetraditional performance evaluation methods and their respective advantages anddisadvantages.The third chapter is the application of EVA in the corporate performanceassessment, including the basic concepts of EVA, the basic principles of EVAvaluation model.The fourth chapter is the empirical analysis, combined with Lida Co., Ltd. ofHenan Shenhuo Group to analyze, then draw and verify conclusions.The fifht chapter is thesis conclusions and vision for the future.