Net Cash

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DEFINITION of 'Net Cash'

A company's total cash minus total liabilities when discussing financial statements. Net cash is commonly used in evaluating a company's cash flow. More generally, net cash can refer to the amount of cash remaining after a transaction has been completed and all charges and deductions related to the transaction have been subtracted.

"Net cash" may also be used as short form for "net cash per share", a stock investing term. More commonly, "net cash" will appear with another word, as in "net cash flow", "net cash income" or "net cash stock".

BREAKING DOWN 'Net Cash'

Investors can use net cash to help determine whether a company's stock offers an attractive investment opportunity, and in some cases it can be used in conjunction with other measures to gauge the company's liquidity. Also, net cash might be used to assess whether a company has enough cash to make investments in future projects.

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RELATED FAQS
  1. Is free cash flow the same as net free cash flow?

    Free cash flow is not the same as net cash flow. Free cash flow is the amount of cash that is available for stockholders ... Read Full Answer >>
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    A liquid asset is cash on hand or an asset that can be readily converted to cash. An asset that can readily be converted ... Read Full Answer >>
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