FCF yield
Free cash flow as a percentage of the company's market value.
Formula
FCF yield = Free cash flow ÷ Market cap
How to read it
Higher is cheaper. It is the inverse of Price / FCF.
How to use it
A cash-based earnings yield to compare with bond yields.
Limitations
Free cash flow swings with working capital and capital spending; withheld for banks.
Also called: fcf yield, price / fcf, ev / fcf.