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Calculate equity free cash flow yield and its reciprocal P/FCF multiple using normalized annual free cash flow. Calculations run only in your browser; your inputs are not sent to Stock Metric Lab.
Cash-flow valuation snapshot
Free cash flow yield
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A higher yield is not automatically better. Normalize cash flow and examine business quality, cyclicality, leverage, and reinvestment needs.
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What free cash flow yield tells you
Equity FCF yield compares cash flow available to common shareholders with the market value of common equity. It is the inverse of the price-to-free-cash-flow multiple when FCF is positive.
FCF yield = Annual equity free cash flow ÷ Market capitalization
Price to FCF = Market capitalization ÷ Annual equity free cash flow
Use a consistent numerator and denominator
This calculator is intentionally equity-based. Do not divide FCFF by market capitalization: FCFF belongs to debt and equity providers and should be compared with enterprise value. Read the complete FCF yield guide and learn how to normalize free cash flow.
For intrinsic value scenarios, continue to the DCF Calculator. To inspect expectations embedded in price, use the Reverse DCF Calculator. Browse every calculator on the Tools hub.
Where to find the inputs
- Operating cash flow: Use the consolidated cash-flow statement in the latest 10-K or 10-Q and review working-capital movements and noncash add-backs in the notes.
- Capital expenditures: Locate purchases of property and equipment in investing cash flow, then check the company definition for finance leases, capitalized software, asset-sale proceeds, and acquisitions. Free cash flow is not a standardized GAAP subtotal.
- Market capitalization: Multiply a current share price by the latest relevant diluted share count, or use a reliable current market-cap figure. Record the price date and keep the currency and scale consistent with FCF.
- Revenue: Use full-year or trailing-12-month consolidated revenue from the income statement when calculating FCF margin.
Prefer SEC filings and issuer investor-relations releases over third-party summaries, and retain both reported and normalized cases when adjustments require judgment.
Important limitations
- Working-capital swings, asset sales, unusually low capital spending, and cyclicality can distort one period’s FCF.
- Negative FCF produces a negative yield and no meaningful P/FCF multiple.
- Compare fiscal periods consistently and use current diluted share counts and market prices.
- Yield alone does not measure growth, competitive advantage, balance-sheet risk, or management’s capital allocation.
Disclaimer
This calculator is for educational and informational purposes only and does not constitute investment, financial, tax, legal, or accounting advice, a recommendation, or an offer to buy or sell any security. Results depend entirely on user-supplied data and may be distorted by non-recurring cash flows or inconsistent units. Stock Metric Lab is not affiliated with any issuer entered by a user. Verify source data independently and consult a qualified professional before making investment decisions.
Need a twelve-month figure between annual reports? Follow our worked guide to calculating TTM free cash flow from a 10-Q.
For a company example of the cash-flow inputs, see how Microsoft’s capital spending affects its cash flow.