Lease Vs Buy Analysis Corporate Finance May 2026

The math was tight. Owning had a slight edge on paper because of the high salvage value Alex assumed. But when Alex factored in the and the fact that a lease preserved cash for the warehouse project, the "hidden" value of the lease started to shine. The Conclusion

The CEO, Sarah, wanted 50 new electric vans. "Buy them," she’d said. "We own our assets. We don’t rent." lease vs buy analysis corporate finance

The real kicker? . In the fast-moving world of EV tech, these vans might be paperweights in five years. With a lease, Midwest could simply hand the keys back at the end of the term. The "Residual Value"—what the vans are worth at the end—was the leasing company’s problem, not Alex’s. Chapter 3: The NPV Showdown The math was tight

Alex opened Excel to calculate the .

At the board meeting, Alex didn't just show spreadsheets; he told the story of . The Conclusion The CEO, Sarah, wanted 50 new electric vans

However, there was the . That $3 million would be sucked out of their working capital. They wouldn't be able to invest in the new automated warehouse project, which had a projected IRR (Internal Rate of Return) of 15%. Chapter 2: The "Lease" Alternative