This professional-grade NPV calculator helps analysts, founders, and students evaluate investments by discounting future cash flows to today’s dollars. It supports both classic periodic cash flows and date-based XNPV, offers sensitivity analysis, and follows strict accessibility and performance best practices.

Data Source and Methodology

  • Primary reference: Brealey, Myers, and Allen, “Principles of Corporate Finance,” 13th ed., 2020, McGraw-Hill. Chapter on Discounted Cash Flow (DCF). Publisher page.
  • Function parity: Microsoft Support — NPV and XNPV functions (last updated 2024). NPV and XNPV.

Tutti i calcoli si basano rigorosamente sulle formule e sui dati forniti da questa fonte.

The Formula Explained

Periodic NPV (equal spacing):

$$ \mathrm{NPV} = C_0 + \sum_{t=1}^{N} \frac{C_t}{(1+r_p)^{t - \delta}} \quad \text{with } \delta=\begin{cases}0 & \text{end of period}\\1 & \text{beginning of period}\end{cases} $$

Per-period discount rate from effective annual rate and frequency f:

$$ r_p = (1+r)^{1/f}-1 $$

XNPV (irregular dates, Actual/365):

$$ \mathrm{XNPV} = \sum_{i=0}^{N} \frac{C_i}{(1+r)^{\frac{d_i - d_0}{365}}} $$

Glossary of Variables

r — Effective annual discount rate (decimal).
f — Cash-flow frequency per year (1, 2, 4, 12).
r_p — Per-period discount rate derived from r and f.
C0 — Initial cash flow at time zero (often negative for an investment).
Ct — Cash flow at period t (periodic) or date i (dated).
d0 — Base date for XNPV (initial cash-flow date).
NPV/XNPV — Sum of discounted cash flows (present value).
Profitability Index (PI) — PV(inflows)/|Initial investment|.

Come Funziona: Un Esempio Passo-Passo

Assume an initial investment of −$10,000 at t0 and four annual inflows of $3,000, $4,000, $4,000, and $3,000 at the end of years 1–4. Let r = 10%.

  1. Convert to per-period rate: f = 1, so r_p = (1+0.10)^(1/1)−1 = 0.10.
  2. Discount each inflow: PV1 = 3000/(1.1)^1 = 2727.27; PV2 = 4000/(1.1)^2 = 3305.79; PV3 = 4000/(1.1)^3 = 3005.26; PV4 = 3000/(1.1)^4 = 2047.10.
  3. Sum PV of inflows: 2727.27 + 3305.79 + 3005.26 + 2047.10 = 11,085.42.
  4. Add C0: NPV = −10,000 + 11,085.42 = $1,085.42.

Since NPV > 0, the project adds value at a 10% required return.

Frequently Asked Questions (FAQ)

What is Net Present Value (NPV)?
NPV is the present value of all inflows and outflows using a specified discount rate. Positive NPV indicates value creation relative to the required return.
When should I use XNPV instead of NPV?
Use XNPV when cash flows occur on irregular dates. It discounts using actual days between dates divided by 365.
How is the per-period rate determined in periodic mode?
From the effective annual rate r and frequency f: r_p = (1+r)^(1/f)−1.
What does the “Beginning of period” option do?
It shifts periodic cash flows back one period (annuity-due convention), increasing their present value compared to end-of-period timing.
Can I enter negative discount rates?
Yes. The tool allows rates down to −99.999% to model unusual macro environments.
Is the Profitability Index always defined?
PI is shown when an initial investment (negative C0) is provided and PV of inflows is positive.
What currency does the tool use?
Values are formatted in USD by default for readability; you can enter any currency amounts since the math is currency-agnostic.

Tool developed by Ugo Candido. Content verified by CalcDomain Editorial Board.
Last reviewed for accuracy on: .