Net tangible assets (NTA) are an important criterion for evaluating a company’s capital structure, finances, and overall operations. It is the true value of a company for the owner and investor, and hence has been the target for valuation methods along the time. A company’s net tangible assets are the sum of its tangible assets like inventory, cash and cash equivalents, buildings, furniture and equipment, and investments, minus its intangible assets like goodwill and brand name, as well as its liabilities.

Net tangible assets provide a way for company owners and investors to measure performance and determine the real value of the company. NTA is also a reliable indicator for financial institutions who want to assess a company's ability to repay its debt and take on new loans. Furthermore, an analysis of NTA shows whether a company relies more on tangible or intangible assets.

For example, a manufacturer such as a car company may have a high NTA because it has several physical assets like current inventory, buildings, and machines. On the other hand, a technology company like Google may have a much lower NTA because most of its assets are intangible, such as its software and intellectual property.

Because NTA measures a highly specific set of assets and liabilities, it can provide greater accuracy than other measurement tools. In addition, it makes it easier for accountants to get an accurate view of the company's finances. NTA is also useful for comparison between companies with different operational models.

Net tangible assets is a helpful measure for stakeholders that provides a more accurate picture of a company's value. Financial institutions, investors, and company owners all depend on its data to inform their decisions and strategies. And by understanding the value of a company’s assets, it’s easier to effectively manage and monitor performance.