Free cash flow per share
factor.formula
Average Shares Outstanding:
Free Cash Flow Per Share (FCF Per Share):
The calculation of this indicator involves two steps: first calculate the average total equity, and then divide the free cash flow over the last twelve months by the average total equity.
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Total share capital at the beginning of the period: refers to the number of common shares issued by the company at the beginning of the reporting period.
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Total share capital at the end of the period: refers to the number of common shares issued by the company at the end of the reporting period.
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Average total share capital: In order to more accurately reflect the equity structure throughout the reporting period, the average of the total share capital at the beginning and end of the period is usually used.
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Free cash flow in the last 12 months: refers to the free cash flow generated by the company in the past 12 months, which is the remaining, freely available cash flow after the company meets operating and capital expenses.
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Free cash flow per share: refers to the free cash flow corresponding to each common share, reflecting the company's ability to create free cash flow for each shareholder.
factor.explanation
Free cash flow per share (FCF Per Share) provides the scale of free cash flow corresponding to each common share of a company, which better reflects the company's ability to create value for shareholders than simple free cash flow. This indicator eliminates the impact of company size and is more suitable for horizontal comparison of companies of different sizes. Higher free cash flow per share usually means that the company has stronger profitability and cash flow generation capabilities, which can be used to support future growth, dividends or reduce debt, making it more attractive to investors. It is worth noting that the analysis should be combined with industry characteristics and company specific circumstances for a comprehensive assessment.