Present Value of Cash Flows
Evaluate investments using time value of money
Ideal for recurring revenues or costs
| Period | Cash Flow |
|---|
| Periods | Cash Flow |
|---|
Present Value by Period
Cumulative NPV
How to interpret these results
Net Present Value (NPV) tells you what all future cash flows are worth in today’s money after accounting for time and risk.
What your result means
- NPV > 0 — the investment is expected to create value above your required return.
- NPV < 0 — expected returns do not justify the cost or risk.
How it’s calculated
Each cash flow is discounted using your selected rate to reflect inflation, risk, and opportunity cost. Earlier cash flows are worth more than later ones.
How businesses use NPV
- Compare multiple investment options
- Evaluate long-term projects and capex
- Decide whether expected returns justify risk
NPV is widely used by founders, CFOs, and investors to make disciplined, data-driven decisions.