Harvard Business Review

MARCH 10, 2011

When executives evaluate a potential investment, whether it's to build a new plant, enter a new market, or acquire a company, they weigh its cost against the future cash flows they expect will spring from it. To make sure they're comparing apples to apples, they discount those future cash flows to arrive at their net present value.

CAPM 13

CAPM Cost Discounted Cash Flow Cost of Capital 13

Harvard Business Review

NOVEMBER 25, 2013

It doesn’t need to be complicated; in one company, a marketing department saved 20 percent after simply benchmarking the money they were spending on external agencies. CFOs are more interested in capital investment estimates, net present values, and a clear outline of the trade-offs of any investment.

CFO 8

CFO Short-term Long-term Benchmarking 8

Harvard Business Review

JUNE 18, 2015

For instance, despite the prominent role that discounted cash flow valuation methods play in academic finance courses, few PE investors use discounted cash flow or net present value techniques to evaluate investments. Rather, they rely on internal rates of return and multiples of invested capital.

CAPM 8

CAPM Discounted Cash Flow Company Rate of Return 8

Harvard Business Review

JUNE 22, 2015

. “It’s one of the more popular ways that managers calculate marketing ROI,” says Avery, pointing out that other common ones include calculating the investment payback period, calculating an internal rate of return, and using net present value analysis.

Payback Period 8

Payback Period Fixed Costs Analysis Price 8