|
| |
| | free cash flow Definition |
 | | Free cash flow is the amount of cash that a company has left over after it has paid all of its expenses, including investments. | | | Operating cash flow (net income plus amortization and depreciation) minus capital expenditures and dividends. | | | Negative free cash flow is not necessarily an indication of a bad company, however, since many young companies put a lot of their cash into investments, which diminishes their free cash flow. |
|
http://www.investorwords.com/2084/free_cash_flow.html
(253 words)
|
|
| |
| | Fool.com: Joy of Free Cash Flow [Drip] February 28, 2002 |
| | Free cash flow is cash from operations (also called operating cash flow) minus capital expenditures, which are investments in property, plant, and equipment. | | | Free cash flow is money earned from operations that a business can actually put into its proverbial savings account after all is said and done. | | | The numbers needed to calculate free cash flow reside on the cash flow statement. |
|
http://www.fool.com/dripport/2002/dripport020228.htm
(1088 words)
|
|
| |
| | Venture Momentum Article - Have You Got Free Cash Flow? |
| | Free cash flow is very important to investors because it provides a measure of a company’s ability to generate cash for distribution to shareholders as dividends, and/or pursue new business opportunities. | | | cash flow is the cash that is available for future growth and/or for distribution to shareholders, after the company has financed its operations and capital expenditures. | | | Unfortunately, free cash flow is not cash flow that is distributed for free at a philanthropic event. |
|
http://www.venturemomentum.com/cashflow.html
(1393 words)
|
|
| |
| | Cash flow statement - Wikipedia, the free encyclopedia |
| | A cash flow statement is a financial report that shows incoming and outgoing money during a particular period (often monthly or quarterly). | | | The cash flow for this example is +$40.00. | | | Cash flow statements are particularly important for start-up companies with limited liquid assets. |
|
http://en.wikipedia.org/wiki/Cash_flow_statement
(307 words)
|
|
| |
| | Free Cash Flow |
| | Free cash flow (FCF) is the amount of cash that remains after deducting the funds the company must commit to continue operating at its planned level. | | | If free cash flow is positive, the company has met all of its planned cash commitments and has cash available to reduce debt or expand. | | | If free cash flow is negative, the company will have to sell investments, borrow money, or issue stock in the short term to continue at its planned levels. |
|
http://college.hmco.com/accounting/needles/fa/instr/ppt/ch14/sld030.htm
(99 words)
|
|
| |
| | Financial Management (Financial Management Association): Operating performance and free cash flow of asset buyers |
| | Cash flows are negative and significantly different from zero in all three years after the acquisition, implying that the sample firms are not performing as well as firms that did not make asset purchases. | | | Following the asset purchase, the matched-firm-adjusted cash flows are an identical -0.009 in years +1, +2, and +3. | | | The mean industry-adjusted level of cash flows in year -1 is 0.040, so the mean decline from year -1 to year +3 as a percentage relative to year -1 is 40%. |
|
http://www.findarticles.com/p/articles/mi_m4130/is_4_32/ai_112452266/pg_4
(1529 words)
|
|
| |
| | Zacks.com - Experts - Commentary - Richard Moroney |
| | Free cash flow equals cash provided by operations (from the statement of cash flows), minus capital expenditures and dividends. | | | Ball’s free cash flow, high relative to its history, is likely to fall a bit next year as the company boosts capital spending in all three of its major business units. | | | When free cash flow is positive, a company has flexibility to repay debt, repurchase shares, raise dividends, and expand via acquisitions and capital expenditures. |
|
http://www.zacks.com/experts/featured/view_article.php?art_id=1762&newsletter_id=33
(1253 words)
|
|
| |
| | Theory of free cash flow |
| | The theory of free cash flow states that investors are entitled to the sum of the operating and investing cash flows, plus any cash interest paid. | | | Cash interest is included because it is seen as flowing to the debt holders of the firm. | | | Since this cash is "tied up in inventory," it represents a use of cash. |
|
http://www.spredgar.com/WebHelp/spredgar/theory_of_free_cash_flow.htm
(982 words)
|
|
| |
| | Integra Telecom - Integra News: Integra Telecom Becomes Free Cash Flow Positive, Achieves New Industry Standard in ... |
| | Free cash flow positive, or free cash flow breakeven, is a financial benchmark indicating that a company generates more cash from operations than it requires to fund its operating costs, capital spending, working capital and debt obligations. | | | Importance of free cash flow positive as a financial indicator | | | Because the telecom industry is capital intensive, financial indicators such as free cash flow positive and EBITDA positive are very closely watched. |
|
http://www.ogitel.net/about/news/news_releases/2003/2003-06-05_news_release.asp
(912 words)
|
|
| |
| | Free Cashflow method |
| | This is the cash that is left over after the payment of all cash expenses and operating investment required by the firm. | | | Free Cashflow (Free Cash Flow method) is an important measure to shareholders. | | | The amount of cash that's left over after the payment of these investments and taxes is known as Free Cashflow (Free Cash Flow). |
|
http://www.valuebasedmanagement.net/methods_freecashflow.html
(291 words)
|
|
| |
| | Free Cash Flow Valuation Techniques Information at Business.com |
| | Free Cash Flow to the Firm','b8ec427d-87f4-11d4-8f81-00d0b74736e1','D68D808C-CE42-46A8-BA01-11A6D0F193B0200512145342585_bravo','http://rd.business.com')" target=_blank>Aswath Damadoran: Free Cash Flow to the Firm | | | Free Cash Flow to Equity of a Stable Growth Firm','b8ec56ae-87f4-11d4-8f81-00d0b74736e1','D68D808C-CE42-46A8-BA01-11A6D0F193B0200512145342585_bravo','http://rd.business.com')" target=_blank>Aswath Damadoran: Spreadsheet for Free Cash Flow to Equity of a Stable Growth Firm | | | A spreadsheet for valuing the equity component of a firm using the free cash flow to firm model. |
|
http://www.business.com/directory/financial_services/investment_banking_and_brokerage/mergers_and_acquisitions_manda/business_valuation_techniques/free_cash_flow
(623 words)
|
|
| |
| | Complete Growth Investor |
| | Most companies put it clearly in the cash from operations of their cash flow statement — filed with the SEC quarterly and annually and freely available at www.sec.gov/edgar - but you need to do the simple math. | | | FCF is simply net cash from operations minus capital expenditures, subject to refinements not relevant here. | | | The trouble with the cash from this tax benefit is that it is not a sustainable source of increased value for the business. |
|
http://www.completegrowth.com/index.php?option=content&task=view&id=97&Itemid=27
(1152 words)
|
|
| |
| | Conscious Investing: FREE CASH FLOW |
| | Free cash flow is not calculated in Conscious Investor since it is not needed in any of the calculations. | | | Whether or not free cash flow is a more useful concept than earnings for understanding a business is not relevant to the Conscious Inventor calculations. | | | To use free cash flow you would have to estimate the price to free cash flow ratio in 5 years. |
|
http://www.conscious-investor.com/whatis/target/freecash.asp
(521 words)
|
|
| |
| | IBM's Cash Flow Is Weaker Than It Looks |
| | That cash outflow could be in the region of $1 billion to $2 billion in 2002. | | | First, we assume the same $10 billion base free cash flow number for 2002 as 2001 -- generous, since net income is expected to decline this year. | | | Free cash flow is one measure that strips out a lot of the earnings noise and focuses more closely on actual greenbacks. |
|
http://www.thestreet.com/_yahoo/markets/detox/10030230.html
(755 words)
|
|
| |
| | Fool.com: Tying It All Together with the Flow Ratio (Rule Maker) December 10, 1999 |
| | To calculate free cash flow, all you have to do is go to the cash flow statement and find the line called "cash flow provided by operations," also known simply as "operating cash flow." Once you've found that, all you have to do is subtract net capital expenditures and what's left is free cash flow. | | | When we calculate the flow ratio, even though current assets -- such as accounts receivable and inventory -- are listed on the balance sheet as "assets," we Rule Maker investors consider them to be liabilities for all practical purposes. | | | In theory at least, free cash flow is the amount of cash a business could issue to shareholders in the form of a dividend check. |
|
http://www.fool.com/portfolios/rulemaker/1999/rulemaker991210.htm
(1584 words)
|
|
| |
| | Free Cash Flow |
| | Except for start up corporations that will often show negative cash flow in their beginning years, free cash flow is a good indicator of a company's ability to both maintain and increase its operations. | | | By dividing free cash flow per share by the company’s current price per share, you’ll get a “free cash flow yield.” This is useful in comparing companies in the same industry. | | | One of the best indicators of corporate health is the Free Cash Flow (FCF) of a company and, unlike some other indicators, it is relatively easy to understand. |
|
http://www.livingtrustnetwork.com/articles/commonsense/commonsense.html
(635 words)
|
|
| |
| | Ernst & Young - Services - Indirect Tax - Free Cash Flow Release |
| | Free Cash Flow Release is Ernst & Young’s innovative approach to quantifying the cost of cash tied up by indirect tax. | | | “Free cash” can be used to reduce borrowing, to reinvest or to distribute to shareholders. | | | Indirect taxes tie up substantial amounts of cash: Value-added tax alone can represent up to 25% of the gross value of all transactions in the supply chain. |
|
http://www.ey.com/global/content.nsf/International/Services_-_Tax_-_Indirect_Tax_-_Free_Cash_Flow_Release
(190 words)
|
|
| |
| | The General Cash Flow Model |
| | This is, the cash flow free to honor returns to debt and equity holders under the going concern assumption. | | | The latter means that the investment needed to create continuing cash flows must be subtracted the gross cash flow (is included in the FCF). | | | It is a discount rate equal to the market cost of financing the capital that generates the FCF. |
|
http://www.encycogov.com/A2MonitorSystems/AppA2MonitorSystems/AppAtoA2CashFlowModel.asp
(833 words)
|
|
| |
| | Forbes.com: Stock Focus: Free Cash Flow |
| | This metric is a straightforward calculation of cash flow from operations, minus capital expenditures and dividends. | | | Another consistent free cash flow generator is First Data (nyse: FDC - news - people), an electronic payments and transaction processing company that provides credit- and debit-card, check and Internet payment services as well as cash transfers through its popular Western Union Financial Services subsidiary. | | | Cash flow from operations refers to net cash provided by operating activities, as listed in the consolidated statement of cash flows. |
|
http://www.forbes.com/2001/06/01/0601sf.html
(692 words)
|
|
| |
| | Free Cash Flow |
| | The term "free cash flow" is used because this cash is free to be paid back to the suppliers of capital. | | | An additional cash adjustment may be necessary for an increase in deferred taxes that would have a positive impact on cash flow. | | | When valuing the operations of a firm using a discounted cash flow model, the operating cash flow is needed. |
|
http://www.quickmba.com/finance/free-cash-flow
(302 words)
|
|
| |
| | Charter Posts Negative Free Cash Flow |
| | But free cash flow, a measure of the company's ability to service its massive debt load, was negative $30 million for the quarter. | | | Charter noted that "the introduction of free periods, and increased marketing costs as compared to prior periods, has put some downward pressure on third quarter revenues, net cash flows from operating activities, and free cash flow." | | | Charter said net cash flow from operating activities rose 24% from a year ago to $353 million. |
|
http://www.thestreet.com/pf/stocks/media/10124036.html
(280 words)
|
|
| |
| | Free Cash Flow - FCF |
| | Free cash flow is important because it allows a company to pursue opportunities that enhance shareholder value. | | | A measure of financial performance calculated as operating cash flow minus capital expenditures. | | | In other words, free cash flow (FCF) represents the cash that a company is able to generate after laying out the money required to maintain/expand the company's asset base. |
|
http://www.investopedia.com/terms/f/freecashflow.asp
(324 words)
|
|
| |
| | Free Cash Flow - Definition |
| | The real difference between earnings and free cash flow is that depreciation accounts for sunk costs of the past; free cash flow is meant to capture all real cash outlays of the present. | | | Similar to earnings, but omitting purely "paper only" expenses, and accounting for capital spending when it actually occurs rather than depreciating it over many years. |
|
http://www.moneychimp.com/glossary/free_cash_flow.htm
(58 words)
|
|
| |
| | Business Wire: Audible, Inc. Announces Positive Free Cash Flow in Q4 2003 on Strong Consumer Content Revenue Growth; ... |
| | Management believes that free cash flow is a useful measure of liquidity because it includes cash provided by operating activities as well as the impact of cash used for investment in property and equipment. | | | The company believes these transactions are of substantial benefit to common shareholders as they significantly curtail future dilution and the requirement of cash dividends to preferred holders. | | | A reconciliation to the GAAP equivalents of this non-GAAP measure is contained in tabular form on the attached unaudited financial statements. |
|
http://www.findarticles.com/p/articles/mi_m0EIN/is_2004_Feb_10/ai_113106351
(1210 words)
|
|
| |
| | BusinessPundit: Free Cash Flow |
| | When it comes to cash, which companies actually use to meet their obligations, net income is not really the bottom line. | | | Learn to manage cash flow, and you'll see higher profitability as well. | | | Net income may not tell you this, but free cash flow will. |
|
http://www.businesspundit.com/archives/001118.html
(282 words)
|
|
| |
| | TMF: Re: Free cash flow yield.. / Qualiport |
| | Free cash flow is essentially the amount of cash the business generates in a year for shareholders after all expenditure to sustain its current competitive position (e.g. | | | Free cash flow therefore funds dividend payments, as well as discretionary activities such as expansion capex, acquisitions etc. | | | I compare free cash flow yields to gilts, but cash is just as good I guess. |
|
http://boards.fool.co.uk/Message.asp?mid=9135480&sort=postdate
(188 words)
|
|
| |
| | Free cash flow/Ratio trends |
| | In free cash flow and ratio plots over time, SPREDGAR treats each quarter as a separate entity and "subtracts out" the previous filings' values. | | | Because SPREDGAR calculates changes in consecutive filings to figure out cash flow, you will always get one fewer graphed periods than worksheets you select for analysis. | | | You may select the worksheets to use for free cash flow analysis in one of several ways: |
|
http://www.spredgar.com/WebHelp/spredgar/free_cash_flow.htm
(685 words)
|
|
| |
| | Smartmoney.com: Stock Screen: Cash Machines |
| | Moreover, free cash flow is useful in evaluating businesses with high up-front costs that depress earnings now, but that are expected to pay off in the future. | | | Put simply, free cash flow is the money a company has left over after paying its day-to-day expenses. | | | Companies with strong free cash flow can use that cash to pay down debt, buy back shares or distribute dividends — all worthwhile pursuits from an investor's perspective. |
|
http://www.smartmoney.com/stockscreen/index.cfm?story=20031029intro
(1169 words)
|
|
| |
| | Free Cash Flow -- Stocks with strong free cash flow growth |
| | Because cash flow is so critical to every company's ultimate success or failure, my staff and I recently went on a hunt for firms that have shown strong FCF growth in recent years. | | | Although that would amount to cash flow growth of +100%, for a relatively sizable company, that low level of cash flow would be virtually meaningless. | | | Although most analysts and investors tend to focus almost exclusively on company balance sheets and income statements, the reality is that the statement of cash flows gives one of the clearest pictures of a firm's financial well being. |
|
http://www.streetauthority.com/cmnts/pt/2004/06-22.asp
(1152 words)
|
|
| |
| | Integra Telecom - Free Cash Flow Primer |
| | That is, operating and non-operating profit before the deduction of interest and income taxes. | | | Utilities have been historically viewed as a solid investment and, consequently, capital flowed into the CLEC market at such a great volume that many hasty, poor management choices were made. | | | · Cash received from customers is greater than cash paid out to vendors, investors and the government. |
|
http://www.integratelecom.com/fcf/fcf_primer.shtml
(362 words)
|
|
| |
| | BW Online February 15, 2002 A Great Start for Finding Good Stocks |
| | In other words, free cash flow equals the cash produced by operations, minus any cash spent on interest payments, taxes, and whatever capital spending is needed not for expansions but simply to keep operations in ordinary trim -- a paint job for the factory walls, but not a new assembly line. | | | Reckoning free cash flow from a standard set of financial statements is no quick task. | | | Because free cash flow is rare -- and because investors really, really want it -- some corporate managers are motivated to tailor their financial reports to distract investors' attention from its absence. |
|
http://www.businessweek.com/bwdaily/dnflash/feb2002/nf20020215_9454.htm
(1249 words)
|
|
| |
| | FREE CASH FLOW |
| | Free excel spreadsheets related to business finance, including valuations, cash flow models, forecasting, and fundamental analysis... | | | the operations cash flow and you'll have a good picture of the amount of free cash that the firm... | | | - Operating free cash flow: this is after taxes. |
|
http://free1.cashu.biz
(530 words)
|
|
| |
| | McDonald's generates record free cash flow newratings.com |
| | The US-based company said in a statement on Friday that its year-end free cash flow increased to a record of $2.5 billion in 2004. | | | NEW YORK, February 11 (newratings.com) — McDonald's Corporation (MCD.NYS), a global casual dining restaurant chain, has reported record high cash flow generation from operations at $3.9 billion for 2004, marking an increase of $600 million over the cash generated the previous year. | | | McDonald's has previously expressed its intention to deploy its surplus cash this year for potential shareholder returns and debt repayments. |
|
http://www.newratings.com/analyst_news/article_690921.html
(277 words)
|
|
| |
| | Free Cash Flow - Research Center For Factoring And Free Cash Flow |
| | Free Cash Flow Controlling Business Cash Flow Identify the most likely cash flow sources in and out of your business, and highly effective reports to help you manage and optimize your business... | | | Operating cash flow (net income plus amortization and depreciation) minus capital expenditures and dividends... | | | Financial risk The risk that the cash flow of an issuer will not be adequate to meet its financial obligations. |
|
http://www.allfactoring.info/l2/FreeCashFlow
(1159 words)
|
|
| |
| | Selling Receivables to Free Up Cash Flow Finance & Accounting > Cash Flow Management |
| | Also look at the timing of your cash inflows and cash outflows and pinpoint the time of the month when you need to have money in the bank. | | | Factoring companies work as middlemen: They buy your accounts receivables or invoices, pay you an advance and then reimburse you for the remainder of the bill, minus a 4 percent to 5 percent fee, once the total bill is paid. | | | Reality: Factoring companies can be a short-term solution any time you need cash flow, and especially when you need capital to ramp up production. |
|
http://www.allbusiness.com/articles/1441-0-0.html
(587 words)
|
|
| |
| | CFO Free Cash Flow Scorecard - - CFO.com |
| | The lab then calculates the free cash dividend payout by dividing the common dividend amount by the adjusted free cash flow figure. | | | It then finds the common dividend amount by subtracting preferred dividends from the total dividend amount recorded in the financing section of the statement of cash flows. | | | The lab next subtracts capital expenditures and preferred dividends from adjusted operating cash flow. |
|
http://www.cfo.com/chart.cfm/3516261
(134 words)
|
|
| |
| | Free Cash Flow: A Powerful Decision- Making Metric |
| | To provide accounting and other financial professionals with a full understanding of Free Cash Flow and how to use this cutting-edge business management tool to create shareholder value. | | | You'll gain insight into the differences between Free Cash Flow and net income in evaluating business performance. | | | Recasting GAAP financial statements to determine Free Cash Flow (FCF) |
|
http://www.cpeonline.com/cpenew/courset.asp?topic1=A209
(201 words)
|
|
| |
| | Free Cash Flow Example |
| | Free Cash Flow = Net Operating Profit After Tax - Net Investment in Operating Capital | | | Assumption 10 - Company distributes 45 percent of their income as dividends. | | | -845 TL Free Cash Flow = Operating Cash Flow - Gross Investment in Operating Capital |
|
http://www.bilkent.edu.tr/~aydogan/freecashflows.htm
(247 words)
|
|
| |
| | IDEX Reports Record 2004 Orders, Sales, Net Income and Free Cash Flow |
| | In 2004, free cash flow (cash flow from operating activities less capital expenditures) was a record $121.2 million. | | | These statements may relate to, among other things, capital expenditures, cost reductions, cash flow, and operating improvements and are indicated by words or phrases such as "anticipate," "estimate," "plans," "expects," "projects," "should," "will," "management believes," "the company believes," "the company intends," and similar words or phrases. | | | EBITDA means earnings before interest, income taxes, depreciation and amortization, and free cash flow means cash flow from operating activities less capital expenditures. |
|
http://www.tmcnet.com/usubmit/2005/Jan/1109648.htm
(2804 words)
|
|
| |
| | The Correct Definition for the Cash Flows to Value a Firm (Free Cash Flow and Cash Flow to Equity) |
| | The main issue is related to the inclusion or exclusion of some items in the working capital and the current practice to consider that funds that appear in the Balance Sheet (cash and market securities and the like) belong to the free cash flow FCF and the cash flow to equity CFE. | | | In the same line of reasoning, the idea is that cash flows have to be consistent with financial statements. | | | With a hypothetical example we show the implicit financial facts reflected in the financial statements behind the practice of including as cash flow items that appear in the Balance Sheet. |
|
http://ideas.repec.org/p/col/000135/000714.html
(404 words)
|
|
| |
| | CableWORLD |
| | A smaller capital budget in 2004 will help the company meet its stated target of reaching $2 billion in free cash flow. | | | That growth, along with a lower-than-expected $3.35 billion capital budget, will free up enough cash for the company to institute a $1 billion stock buyback. | | | Combined with the $1.7 billion in cash it holds and some $3 to $4 billion in investments in Time Warner and Liberty Media, Comcast has considerable firepower for acquisitions. |
|
http://www.broadband-pbimedia.com/cgi/cw/show_mag.cgi?pub=cw&mon=010504&file=comcast.htm
(419 words)
|
|
| |
| | Free Project Cash Flow Template Software |
| | We work hard and at considerable cost to provide our members with valuable information free of charge and don't appreciate black-hat tactics which try to exploit our service. | | | IT VendorSearch.com may use the information you have provided to inform you about other publications, products and services, unless you notify us that you do not wish to receive this information. | | | If you do not already receive the Newsletter simply fill out the subscription form and get the information you should know... |
|
http://www.itvendorsearch.com/itvs/free-project-cash-flow-template-software.asp
(295 words)
|
|
| |
| | uk business finance: business loans, free cash flow, lease finance |
| | We have a network of business advisers waiting to help you with information, guidance and services to assist you in financing your company debts and improving your cash flow. | | | In fact, with factoring you also get the benefit of the factors customer vetting and cash collection skills which means you can lean on them for this specialist skill as a no-cost service. | | | uk business finance: business loans, free cash flow, lease finance |
|
http://www.bizhelp24.com/services/commercial_finance/ukcashflow24
(248 words)
|
|
| |
| | BellSouth Lowers Reported Free Cash Flow |
| | The local telephone company said that free cash flow, defined as cash flow from operations minus capital expenditures, was actually $1.1 billion in the second quarter and $2.2 billion for the year to date. | | | BellSouth had previously reported free cash flow of $1.4 billion for the quarter and $2.4 billion for the first half of the year. | | | BellSouth (BLS:NYSE - news - commentary - research - analysis) lowered its previously reported free-cash-flow figures for the second quarter and first half of the year, saying the difference reflects the redemption of $250 million of debentures. |
|
http://www.thestreet.com/tech/telecom/10034515.html
(129 words)
|
|
| |
| | Stock-Picking Tool: Free Cash Flow - Forbes.com |
| | To put together the list of companies in the table below, we started by requiring free cash flow greater than $100 million over the past 12 months and improving year-over-year quarterly levels of free cash flow--both on an absolute basis and as a percentage of revenue. | | | Here's one good cash-flow item to watch: free cash flow, or net income plus depreciation minus capital expenditures. | | | WASHINGTON - Wall Street has come up with a variety of ways to define cash flow, but not all of them are helpful to investors. |
|
http://www.forbes.com/2003/08/08/cz_ag_0808sf.html
(493 words)
|
|
| |
| | SPX Updates 2003 Free Cash Flow Target |
| | The free cash flow target range is based on cash from continuing operations of $485 to $530 million less capital expenditures of $70 to $80 million. | | | The FAQ's reflect the increased 2003 free cash flow target and items updated in SPX's amended Form S-3 filed today with the Securities and Exchange Commission. | | | SPX Corporation is a global provider of technical products and systems, industrial products and services, flow technology and service solutions. |
|
http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=104&STORY=/www/story/12-12-2003/0002074463&EDATE=
(286 words)
|
|
| |
| | Projected Free Cash Flow |
| | (1) Cash flow from operations defined as Net Income (adjusted for non-cash items excluded from operating earnings in 2004) plus depreciation, depletion and amortization, deferred taxes and investment tax credits. | | | Free Cash Flow Estimate Range $600 - $800 $200 - $400 $100 - $300 | | | Cash flow from operations (1) $3,760 $3,950 $4,060 |
|
http://www.dom.com/investors/presentations/eei102604/tsld021.htm
(105 words)
|
|
| |
| | Free Cash Flow to Equity |
| | I used the equation: Net Cash Provided by Operating Activities divided by Number of Shares Outstanding, to derive my FCFE number of 1.0253 (3076/3000). | | | According the estimate, the stock is well under-valued by approximately 24 points (recent market price was 43 1/2 points). | | | I feel this model gives a better estimate of value because this estimate not only came out significantly closer to the actual value of Pfizer stock than the two-stage growth model method given in step seven, but it also produced a positive value which the constant growth model did not. |
|
http://www.resnet.trinity.edu/jchurch/8.htm
(93 words)
|
|
|
