What Is Free Cash Flow?
Definition and plain-English explanation of "Free Cash Flow"
Free cash flow (FCF) is the cash a company generates from its operations after spending on capital expenditures (buildings, equipment, etc.). It is the money left over that a company can use to pay dividends, buy back stock, pay down debt, or reinvest in growth. Many analysts consider free cash flow a more reliable indicator of financial health than reported earnings.
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