Noun
/friː kæʃ floʊ/
Free cash flow (FCF) is a financial metric representing the cash generated by a company's operations that is available for distribution to creditors and shareholders, after accounting for capital expenditures necessary to maintain or expand the asset base. It is important because it indicates how much cash a company has to fund expansion, pay dividends, or reduce debt.
Free cash flow is widely used in both oral and written contexts, especially in finance, investing, and corporate strategy discussions. Its frequency of use is significant in professional settings, among analysts, investors, and company management.
Free cash flow is a critical indicator of a company's financial health, as it reveals how much liquid cash is available after operational costs.
El flujo de caja libre es un indicador crítico de la salud financiera de una empresa, ya que revela cuánto efectivo líquido está disponible después de los costos operativos.
Investors closely watch free cash flow figures, believing they provide important insights into future growth potential.
Los inversores vigilan de cerca las cifras del flujo de caja libre, creyendo que proporcionan información importante sobre el potencial de crecimiento futuro.
A decline in free cash flow might signal that a company is struggling to maintain its capital expenditures effectively.
Una caída en el flujo de caja libre podría señalar que una empresa está luchando por mantener eficazmente sus gastos de capital.
Free cash flow is primarily a financial term, but it can be used in several idiomatic expressions related to finance and investment:
"Free cash flow generation" is essential for a sustainable business model.
La generación de flujo de caja libre es esencial para un modelo de negocio sostenible.
"Positive free cash flow" indicates that a company is thriving financially.
El flujo de caja libre positivo indica que una empresa está prosperando financieramente.
Companies often aim for "consistent free cash flow" to ensure steady growth and shareholder satisfaction.
Las empresas a menudo buscan un flujo de caja libre consistente para garantizar un crecimiento estable y la satisfacción de los accionistas.
A "free cash flow forecast" can help investors make informed decisions about buying or selling stocks.
Un pronóstico del flujo de caja libre puede ayudar a los inversores a tomar decisiones informadas sobre la compra o venta de acciones.
"Managing free cash flow" effectively can differentiate successful companies from those struggling financially.
Gestionar el flujo de caja libre de manera efectiva puede diferenciar a las empresas exitosas de aquellas que luchan financieramente.
The term "free cash flow" combines "free," originating from the Old English freo, meaning unhindered or not subject to control, and "cash flow," which derives from "cash" (French casse, meaning money, derived from Latin capsa, meaning box) and "flow," originating from the Old English flōwan, meaning to move or flow freely. The term began gaining prominence in the financial sector in the late 20th century as companies sought better ways to present their financial health to investors.
Synonyms: - Available cash - Cash available for distribution - Operating cash flow (with reservations about context)
Antonyms: - Negative cash flow - Cash shortfall - Cash depletion
This overview provides a comprehensive look into the term "free cash flow," its usage, significance, and related idiomatic expressions.