Net Investment

A measure of a company's investment in capital, found by subtracting non-cash depreciation from capital expenditures. This measure helps to give a sense of how much money a company is spending on capital items (such as property, plants and equipment), which are used for operations.

Calculated as:





Taobiz explains Net Investment
Continued investment in the capital of a company is vital because the useful life of existing capital diminishes over time. The amount of net investment compared to such things as revenue will differ between industries and between businesses depending on how capital intensive the business is.