Revenue is an opinion, cash flow is a fact. The Cash Flow Statement is one of the most important statements in a 10-K. In this article, I’ll teach you how to analyze a Statement of Cash Flows in a few minutes.
CQ, many thanks for another great and very informative article!
It was late last night, when I started going through it, but my tired eyes were soon closing, and I couldn't finish it. I finished reading it today after filling out the request form for the BRK meeting credentials. On this topic, are you planning on attending? It would be a great pleasure to shake your hand and buy you a drink as a small token of gratitude.
And I have one more question. Can you recommend a great book on analyzing financial statements. I own a few, but I find that they all give only the basics and lack a more sophisticated explanation of the income statement, balance sheet and cash flow statement.
Great read regarding Cash Flow and types of Cash Flow. As I was reading other articles pertaining FCF, have noticed that some companies use stock-based compensation(SBC) as expense in Income statement, especially to reach FCFE. According to Professor of Valuation Aswath Damodaran also teaches "that this real cost to shareholders should be reflected in a valuation model. He believes that SBC should NOT be added to Net Income in order to reach FCFE."
Not sure How many companies use SBC as expense in Income statement itself ?
Nice work, CQ!
Thank you so much for having this content free, it’s greatly appreciated, im sure everyone reading agrees!
CQ, many thanks for another great and very informative article!
It was late last night, when I started going through it, but my tired eyes were soon closing, and I couldn't finish it. I finished reading it today after filling out the request form for the BRK meeting credentials. On this topic, are you planning on attending? It would be a great pleasure to shake your hand and buy you a drink as a small token of gratitude.
And I have one more question. Can you recommend a great book on analyzing financial statements. I own a few, but I find that they all give only the basics and lack a more sophisticated explanation of the income statement, balance sheet and cash flow statement.
All my very best!
I remember it from accounting courses and it was the most difficult statement to get your head around sometimes... 😀
Love your content. Easy to digest. Well presented
Wow now that's enlightenment in simple way kudos
Great read regarding Cash Flow and types of Cash Flow. As I was reading other articles pertaining FCF, have noticed that some companies use stock-based compensation(SBC) as expense in Income statement, especially to reach FCFE. According to Professor of Valuation Aswath Damodaran also teaches "that this real cost to shareholders should be reflected in a valuation model. He believes that SBC should NOT be added to Net Income in order to reach FCFE."
Not sure How many companies use SBC as expense in Income statement itself ?
Many Thanks
Regards
Vikram
Bravo
Can you elaborate on the indirect vs direct method of showing the CFS?
Why do firms use different methods? How to compare them? Whats the difference from a modelling perspective and as an investor?