What is 'Free Cash Flow  FCF'
Free cash flow (FCF) is a measure of financial performance calculated as operating cash flow minus capital expenditures. Free cash flow (FCF) represents the cash that a company is able to generate after laying out the money required to maintain or expand its asset base. Free cash flow is important because it allows a company to pursue opportunities that enhance shareholder value. Without cash, it's tough to develop new products, make acquisitions, pay dividends and reduce debt. FCF is calculated as: EBIT(1Tax Rate) + Depreciation & Amortization  Change in Net Working Capital  Capital Expenditure. It can also be calculated by taking operating cash flow and subtracting capital expenditures.
BREAKING DOWN 'Free Cash Flow  FCF'
Some believe that Wall Street focuses myopically on earnings while ignoring the "real" cash that a firm generates. Earnings can often be clouded by accounting gimmicks, but it's tougher to fake cash flow. For this reason, some investors believe that FCF gives a much clearer view of the ability to generate cash (and thus profits).It is important to note that negative free cash flow is not bad in itself. If free cash flow is negative, it could be a sign that a company is making large investments. If these investments earn a high return, the strategy has the potential to pay off in the long run.FCF is a better indicator than the P/E Ratio and here's why  Read Free Cash Flow Yield: The Best Fundamental Indicator and FCF: Free, But Not Always Easy

Trailing FCF
A company's free cash flow for the previous 12 months. Trailing ... 
Free Cash Flow To Sales
A ratio that illustrates the percentage of free cash flow to ... 
Cash Flow
The net amount of cash and cashequivalents moving into and out ... 
Operating Cash Flow Margin
A measure of the money a company generates from its core operations ... 
NonOperating Cash Flows
Cash flows (inflows and outflows) that are not related to the ... 
Cash Flow From Financing Activities
A category in the cash flow statement that accounts for external ...

Investing
Free Cash Flow: Free, But Not Always Easy
Free cash flow is a great gauge of corporate health, but it's not immune to accounting trickery. 
Markets
4 Companies with High Free Cash Flow Yield
High free cash flow yield indicates strong return for the shareholders. 
Trading
Free Cash Flow Yield: A Fundamental Indicator
Free cash flow can measure a businessâ€™s performance as if youâ€™re looking at its net income line. 
Markets
This Ratio Reveals The Market's Top Bargains
With the ink dry on 2013 financial results, investors can get a fresh gauge on how companies fared over the past year. #ad_banner#By and large, 2013 a very good year for corporate America, ... 
Markets
This LittleKnown Ratio Reveals The Market's Top Bargains
With the ink dry on 2013 financial results, investors can get a fresh gauge on how companies fared over the past year. #ad_banner#By and large, 2013 a very good year for corporate America, ... 
Investing
Evaluating A Statement Of Cash Flows
The metrics for the Statement of Cash Flows is best viewed over time. 
Investing
Analyze Cash Flow The Easy Way
Find out how to analyze the way a company spends its money to determine whether there will be any money left for investors. 
Investing
Fundamental Case Study: Is Amazon's Cash Flow Actually Solid? (AMZN)
Review Amazon's cash flow situation, including its free cash flow yield, operating cash flow from organic growth and cash flow from debt financing. 
Investing
Analyze Cash Flow The Easy Way
Cash flow statements reveal how a company spends its money and where that money comes from. 
Investing
Operating Cash Flow: Better Than Net Income?
Differences between accrual accounting and cash flows show why net income is easier to manipulate.

What is the difference between cash flow and free cash flow?
Learn about the main differences between cash flow and free cash flow. In addition to the differences, learn how to calculate ... Read Answer >> 
What is the formula for calculating free cash flow?
Read about some of the formulas for free cash flow, why investors perform cash flow analysis and what a high or rising cash ... Read Answer >> 
How do you calculate free cash flow?
Find out how to calculate free cash flow (FCF), learn why the figure is important and examine the case of Google's FCF during ... Read Answer >> 
What are some examples of how cash flows can be manipulated or distorted?
Read about some of the most common accounting techniques that can be used to manipulate the operating cash flow on a company's ... Read Answer >> 
Is free cash flow the same as net free cash flow?
Know the difference between your net cash flow and free cash flow when pitching your company to any of your potential stockholders. Read Answer >> 
What is the formula for calculating free cash flow in Excel?
Find out more about free cash flow, the formula for calculating free cash flow and how to calculate a company's free cash ... Read Answer >>