EVA, an acronym for economic value added, is the registered tradename of Stern Stewart & Company for their version of a long-known and compelling concept called residual income. Hailed by Fortune as the “New Key to Creating Wealth” and “Today’s Hottest Financial Product,” EVA has recently attracted considerable attention as a valuation and incentive tool. With a host of consultants now marketing related metrics, numerous claims have been made – most based on anecdotal evidence or in-house studies. However, little independent evidence has existed until recently regarding EVA’s alleged advantages. This article helps fill this void by presenting results from recent academic research.