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.
References in periodicals archive ?
We characterize a stock as having "reasonable valuation" if its price-to-earnings ratio or other valuation metrics (such as price to sales, stock price to book value, and stock price to cash flow) are below historical ranges for the stock, below that of its peers, and are reasonable relative to the company's earnings growth potential.
" Price to cash flow ratio: which tells you a market's expectations of a firm's future health.
'Unloved' companies have been identified as those whose free cash flow growth record (three years historic, two years forward) is greater than the market average but whose price to cash flow per share relative to the market is less than the average.