Owner Earnings Run Rate
 |
Definition of 'Owner Earnings Run Rate'An extrapolated estimate of an owner's earnings (free cash flow) over a defined period of time (typically a year). This assumes that the firm's financial performance stays consistent throughout the period. Therefore, this estimate can be difficult to assess if the firm is operating in a business that experiences seasonality, because owner earnings from one period may not be applicable across the entire time period. |
 |
Investopedia explains 'Owner Earnings Run Rate'For example, after three quarters of performance, the company's owner earnings is $9 million. Assuming that performance stays consistent, the company's owner earnings run rate for the fiscal year would be $12 million ($3 million per quarter).Owner earnings is often an important metric that investor's can use to gauge a firm's financial health. Increased owner earnings tend to act as a signal that a company's subsequent earnings will be good. Therefore, assessing an accurate owner earnings run rate could be very important in predicting the company's longer term performance. |
Related Definitions
Articles Of Interest
-
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. -
The Essentials Of Corporate Cash Flow
Tune out the accounting noise and see whether a company is generating the stuff it needs to sustain itself. -
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. -
Strong Volume Gainers, Can It Continue?
Volume is one of those indicators that gets overlooked, likely because it's shown by default on almost every chart, making it a little dull. But volume is what drives markets. Big volume jumps ... -
Market Summary For May 17, 2013
The U.S. stock markets moved sharply higher this week, on track for its fourth straight week of gains, driven by ongoing improvements in economic indicators. -
Market Summary for May 10 2013
Major U.S. indices moved higher this week but, given the new highs, traders should watch for retracements next week. -
Overheated Expectations Send Rackspace Investors To The Torture Chamber
Absent a real competitive moat, it's hard to make sense of Rackspace's valuation. -
Buying The Upward Trend Channel Bounce
Find out how to set up the trades for four stocks that are moving higher within well-defined trend channels. -
Johnson Controls Has A Lot Of Improving Left To Do
Analysts are projecting a big turnaround in Johnson Controls' margins, but that the downside risks are meaningful -
Market Summary for May 3 2013
The U.S. stock market extended its rally higher this week, led by technology stocks and lagged by small-cap stocks. Traders should be watching a number of other reports due out next week.
Free Annual Reports
