Net Operating Profit After Tax. An estimate of what a company would earn if it didn't have any debt, equal to operating income times (1 minus the tax rate). For companies which use leverage, NOPAT is an alternative measure for measuring operating efficiency. NOPAT is frequently used for calculating Economic Value Added (EVA).

Use NOPAT in a sentence

I realized that after learning about NOPAT, we would have had a lot more money if we did things differently.

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Our NOPAT was higher than originally forecast, and management was rather celebratory in its remarks when they released the news.

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Debt constantly comes with an unwieldy interest rate, often times companies goals are to become NOPAT which indicates that they are using full profits towards further company development instead of having 10% of their profits used towards interest on debt that they have acquired.

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noon rate after tax operating income (ATOI)