Net present value of growth opportunities is a calculation of the net present value of all future cash flows involved with a potential acquisition.

When net present value is less than zero, the project is expected to lose money. Projects with a negative net present value should be avoided.

Learn how to calculate the net present value (NPV) of your investment projects using Excel's XNPV function.

Definition: The net present value (NPV) of an investment is the present (discounted) value of future cash inflows minus the present value of the investment and any associated future cash outflows ...

Net present value and the profitability index are helpful tools that allow investors and companies make decisions about where to allocate their money.

The net present value (NPV) method can be a very good way to analyze the profitability of an investment in a company, or a new project within a company.

Net Present Value Method Under the net present value (NPV) method, you examine all the cash flows, both positive (revenue) and negative (costs), of pursuing a project, now and in the future.

The net present value (NPV) method can be a very good way to analyze the profitability of an investment in a company, or a new project within a company.

This is called the time value of money. But how exactly do you compare the value of money now with the value of money in the future? That is where net present value comes in.

Here's an explanation and simple example of how to calculate the present value of free cash flow.

How net present value works The basic tenet of the net present value method is that a dollar in the future is not worth as much as one dollar today.