What is Free Cash Flow (FCF)?
Free Cash Flow is the cash a business generates after maintaining and growing its asset base. It's the truest measure of the cash a company has available to return to shareholders, pay down debt, or invest in growth. Sustained FCF growth is one of the strongest signals of long-term value creation.
Formula
FCF = Cash From Operations − Capital Expenditures
How TopTier Strategy uses Free Cash Flow (FCF)
FCF and FCF growth are top-priority inputs to both the Growth and Valuation pillars — this is where real shareholder value is created.
Related Glossary Terms
Other concepts in the Growth pillar.
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