Medical Devices And Enterprise Value Of Listed Companies EVA Correlation Analysis

With the mutual integration and improvement of China’s socialist market economy andcapital markets, the competition among enterprises get more intense, while the purpose ofbusiness were maximize enterprise value. The method of evaluate enterprise value usuallyhave market approach, income approach, the cost method and option valuation, etc. EconomicValue Added (EVA) was a comprehensive assessment of the ability to create business valueand business performance, as a new valuation method. Based on the theoretical of economicvalue added and corporate value, article takes the research on relevance of EVAand enterprisevalue in the field of medical devices. Are EVAassociated with the enterprise, which index thathave power explanation between EVA and traditional financial indicators, whether can betterexplain this correlation while combined EVA and traditional financial indicators. All theseneed to be a deeper analysis.The article take the example of Shanghai and Shenzhen listed companies in the medicaldevice industry category, Firstly, article analyzes the industry demand, industry risk and R&D spending, and analysis of the necessity of the EVA used in the medical device industry.Secondly, take the example of companies from2009to2013five-year data to calculate thevalue and taking the average of EVA. Hypothesized the relevance of EVAand enterprise value,choose EPS, ROE, ROA, NAVPS, EVA as explanatory variables, and select MVA as thedependent variable. Finally, empirical research, in addition to analysis the relevance of EVAand enterprise value, will also study the correlation between the empirical and the enterprisevalue of the traditional variables, and make the empirical results for further analysis.The results show that positive relationship exist between EVA with the enterprise value,and the explanatory power of EVA to enterprise value stronger than traditional accountingindicators, and combination of EVA and traditional index also has greater explanatory powerto enterprise value. Finally, based on the empirical research of correlation, on the combinationof EVA used in the medical device industry management as well as the enterprise value,summed EVAapplication also should be reflected in the management level, companies shouldcontinue to strengthen internal management.