Price-to-Cash Flow Ratio

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Price-to-Cash Flow Ratio

The ratio of a company's stock price to the quantity of its cash inflows, minus its cash outflows over a given time, usually a year. The price-to-cash flow is similar to a company's price-earnings ratio, but it does not take into account earnings that have not actually been received. Some analysts prefer the price-to-cash flow ratio because it allows them to assess risk relative to the company's cash on-hand, instead of the cash it ought to have.
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Additionally, the stock is trading at a price to cash flow ratio of 3.
Table 5 Price to Cash Flow Ratio Electrical Gas Telephone All Three-year average 5.
And just like the P/E ratio is calculated by dividing the Price by its Earnings per share -- the Price to Cash Flow ratio is calculated by dividing the Price by its Cash Flow per share.
And just as the P/E ratio is calculated by dividing Price by its Earnings per share -- the Price to Cash Flow ratio is calculated by dividing Price by Cash Flow per share.
CHICAGO -- Kevin Matras shows how to search for stocks with increasing Cash Flows, but low Price to Cash Flow ratios.
We have a preference for companies with below average price/earnings ratios, below average price to cash flow ratios, below average PEG ratios (that's price/earnings to growth rate) for their sectors, but not necessarily deep value.