Free cash flow yield (FCF yld)
The cash left after capital spending, expressed as a percentage of what the shares cost.
It is the closest thing to the cash return an owner of the whole company would receive this year.
How it is computed here
Free cash flow per share / share price x 100
Combines more than one basis. See the note. The pipeline prefers the data vendor's published trailing-twelve-month ratio when one exists, and falls back to recomputing from the latest filed fiscal year when it does not. Those two are different measurements: the vendor figure puts twelve months of flow over the most recent quarterly balance sheet. The source trail on each figure names which path produced it. Filed under value. Higher is the stronger reading, other things equal.
The readings, and where the lines come from
| Range | Reading |
|---|---|
| below 2.0% | Thin |
| 2.0% to 5.0% | Ordinary |
| 5.0% to 8.0% | Generous |
| 8.0% and above | Very high, ask why |
A practitioners’ convention, not an estimated boundary. Convention rather than an estimated boundary; the edges sit either side of the long-run real return on equities.
When it misleads
- A very high yield is usually a market forecast that the cash flow will not last. Treat it as a question, not a verdict.
- Free cash flow is lumpy; a single heavy investment year understates a good business.
- Clamped to a range of -200 to 200 percent.
Ten filed years of it, company by company
Any covered company has the page at /metrics/fcf-yield/TICKER. These are the ones with at least 5 computed years among the largest companies covered, listed alphabetically.
AAPL · ABBV · ABT · ADI · AMAT · AMD · AMGN · AMZN · ANET · APH · AVGO · AXP · BLK · CAT · COP · COST · CRM · CRWD · CSCO · CVX · DE · DELL · DHR · DIS · ETN · GE · GILD · HD · IBM · INTC · JNJ · KLAC · KO · LIN · LLY · LRCX · MA · MCD · META · MRK · MRVL · MSFT · MU · NFLX · NOW · NVDA · ORCL · PANW · PEP · PFE · PG · PLTR · PM · QCOM · RTX · SCCO · STX · T · TJX · TMO · TMUS · TSLA · TXN · UNH · UNP · WELL · WMT
Questions
How is free cash flow yield calculated?
Free cash flow per share / share price x 100. Combines more than one basis. See the note. The pipeline prefers the data vendor's published trailing-twelve-month ratio when one exists, and falls back to recomputing from the latest filed fiscal year when it does not. Those two are different measurements: the vendor figure puts twelve months of flow over the most recent quarterly balance sheet. The source trail on each figure names which path produced it.
What does free cash flow yield tell a value investor?
It is the closest thing to the cash return an owner of the whole company would receive this year.
When does free cash flow yield mislead?
A very high yield is usually a market forecast that the cash flow will not last. Treat it as a question, not a verdict. Free cash flow is lumpy; a single heavy investment year understates a good business. Clamped to a range of -200 to 200 percent.