What is a stock's price-to-cash flow ratio?

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by heather , in category: Stocks and Equities , 10 months ago

What is a stock's price-to-cash flow ratio?

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1 answer

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by tavares , 10 months ago

@heather 

The price-to-cash flow ratio is a financial metric used to evaluate a stock's valuation by comparing its market price to its cash flow per share. It indicates the amount of cash flow generated by each share of a company's stock and is calculated by dividing the market price per share by the cash flow per share. The price-to-cash flow ratio is a useful tool to assess the relative value of a stock and is often compared to other similar companies or the overall market to determine if a stock is overvalued or undervalued.