Free NPV and IRR Calculator
Evaluate a project or investment from its cash flows. Get net present value, internal rate of return, MIRR, payback period, discounted payback and profitability index in one go.
NPV and IRR Calculator: Evaluate a project or investment from its cash flows. Get net present value, internal rate of return, MIRR, payback period, discounted payback and profitability index in one go. It is free, needs no sign-up and runs in your browser. How to use it: 1) paste your cash flows, starting with the initial investment as a negative number; 2) set the discount rate per period, and optional finance and reinvestment rates for MIRR; 3) read NPV, IRR, MIRR and payback, then check the NPV profile and cash flow table. Net present value (NPV) turns every future cash flow into today’s money with your discount rate and adds them up. A positive NPV means the project earns more than that rate.
How the NPV and IRR calculator works
Net present value (NPV) turns every future cash flow into today’s money with your discount rate and adds them up. A positive NPV means the project earns more than that rate. The internal rate of return (IRR) is the rate at which NPV is exactly zero.
A robust IRR solver
The tool scans rates from -99% to 1000% and bisects every point where NPV changes sign. This finds every IRR, not just one. If the cash flows change sign more than once there can be several IRRs, and the tool lists them all and warns you. If there is no IRR, it says so instead of guessing.
Formulas
- NPV:
sum of CF_k / (1 + r)^k - IRR: the rate where NPV = 0
- MIRR:
(FV of inflows at the reinvestment rate / PV of outflows at the finance rate)^(1/n) - 1 - Profitability index:
PV of inflows / PV of outflows - Payback: the period where cumulative cash flow turns positive, interpolated inside that period.
Example: -50,000 then 15,000, 18,000, 20,000, 12,000 and 8,000 at 10% gives an NPV of 6,702.22, an IRR of 15.588% and a payback of 2.85 years.
Limitations
Results are only as good as your cash flow estimates and discount rate. The tool assumes equal periods and end-of-period cash flows, and the rates must match the period length. Taxes and inflation are only included if you build them into the cash flows. This is not investment advice.
NPV and IRR Calculator FAQs
What is the difference between NPV and IRR?
NPV gives the value a project adds in today’s money at your chosen discount rate. IRR gives the rate of return at which NPV is zero. NPV answers how much value you gain, while IRR answers what return you earn. When the two disagree on ranking projects, NPV is usually the better guide.
Why does my project have two IRRs?
When cash flows change from negative to positive and back again, NPV can cross zero more than once, giving several IRRs. For example, -100, 230 and -132 has IRRs of exactly 10% and 20%. In that case IRR cannot rank the project, so use NPV at your required rate or the MIRR instead.
What is MIRR and why use it?
MIRR, the modified internal rate of return, assumes positive cash flows are reinvested at a realistic rate and negative ones are financed at your borrowing rate. It always gives a single answer and avoids the overly optimistic reinvestment assumption built into IRR. By default both rates equal your discount rate.
How is the payback period calculated?
The payback period is when the running total of cash flows turns from negative to positive. The tool interpolates inside that period. With -50,000 followed by 15,000, 18,000 and 20,000, the total reaches -17,000 after year two, so payback is 2 + 17,000 / 20,000 = 2.85 years. Discounted payback uses present values instead.
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