Net Cash


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".


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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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  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 >>
  2. How can companies use the cash flow statement to mislead investors?

    Cash flow is a means for most investors to examine the actual economics of a business they might invest in, especially from ... Read Full Answer >>
  3. How do I use discounted cash flow (DCF) to value stock?

    Discounted cash flow (DCF) analysis can be a very helpful tool for analysts and investors in equity valuation. It provides ... Read Full Answer >>
  4. How do dividends affect the balance sheet?

    Dividends paid in cash affect a company's balance sheet by decreasing the company's cash account on the asset side and decreasing ... Read Full Answer >>
  5. Who actually declares a dividend?

    It is a company's board of directors who actually declares a dividend. The declaration date is the first of four important ... Read Full Answer >>
  6. Are dividends considered an expense?

    Cash or stock dividends distributed to shareholders are not considered an expense on a company's income statement. Stock ... Read Full Answer >>

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