Free Cash Flow to Equity…作者: dmrktrading 时间: 2013-4-12 22:27
FCFE CFO FCInvestment+Capex
Where CFO Net Income + Noncash charges (Dep.)
IF CFO isn’t given then WC needs to be subracted also作者: LorrinCFA 时间: 2013-4-12 22:27
Free cash flow is cash available for positive NPV opportunities right?作者: JonnyKay 时间: 2013-4-12 22:27
there were 12 FCFE questions in june 2008作者: AnalystForum 时间: 2013-4-12 22:28
do you guys have any trick to remembering those two? I can’t seem to retain that for the life of me (despite knowing it will certainly be a question.作者: LiquidAssets10 时间: 2013-4-12 22:28
BJ,
The easiest way I’ve seen it was in secret sauce:
FCFE = CFO FCINV + net borrowing
FCFF = CFO FCINV + int(1t)
Of course, CFO = NI + noncash charges + depreciation
I remember that the interest expense is added back to FCFF because the debt holders are involved.
By the way, can anyone give an intuitive definiiton for what these two actually mean? Yes, I know is cash available to the firm or to equity holders, but what’s perhaps an easier simpler way to interpret it?
