Cash Flow

7 pages carry this tag.

Analysis

Financial Analysis

What Three Years of a Cash Flow Statement Reveals That One Year Hides

Profit is an opinion, cash is a fact, and one year of cash flow is a snapshot. It takes three years for the snapshot to become a story.

19 Mar 20266 min readRead more

Concept Guides

Concept Guide

Reading a Cash Flow Statement

Profit can be manipulated; cash is harder to fake. The cash flow statement tracks the actual movement of money in and out of the business during a period.

8 min readRead more

Concept Guide

Linking the Three Statements

The three financial statements are not independent documents, they are three views of the same underlying reality.

10 min readRead more

Concept Guide

Working Capital

Working capital is the cash tied up in the day-to-day running of a business.

8 min readRead more

Formulas & Ratios

Formula

CFO to PAT Ratio

The CFO to PAT ratio compares five years of cash flow from operations with five years of reported net profit. It is the simplest anti-fraud check in fundamental analysis.

Formula

Free Cash Flow

Free cash flow is operating cash flow minus the cash the business is forced to reinvest to keep running and growing. It is the money that is genuinely surplus.

Formula

Cash Flow per Share

Cash flow per share is operating cash flow divided by the number of shares. Set next to EPS, it shows how much of each share's reported profit actually arrived as cash.