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Price to cash flow ratio

Price to cash flow ratio

Description

Price/cash flow ratio shows the amount of operating cash flow per one dollar of share. It is similar to P/E ratio. The only difference is that when calculating the P/E ratio, net income (earnings) are used instead of the operating cash flow. Data to calculate this ratio is collected from the statement of market bulletin and cash flow statement.

Norms and limitations

In general, there are no norms for this ratio.

It is recommended to compare this ratio to those of the companies, working within the same industry.

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