Berk's Blog

Why We Buy EVA Companies

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Companies that have adopted, or are in process of adopting, a Value-Based Management (“VBM”) program such as Economic Value Added (“EVA”) have produced superior risk-adjusted returns over the long-term.

Our philosophy holds that a public commitment to VBM by a management team who has been unwilling, unmotivated or unable to address issues that are within its control, triggers tactical and strategic changes that increase shareholder value.

Like an internal activist investor, the EVA Financial Management system or another value-based corporate performance measurement, planning and incentive system often catalyzes value creating actions like spin-offs, share buybacks, asset sales,recapitalization and restructuring.