Free Cash Flow To Equity

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Finance

Free Cash Flow To Equity financial calculator.

Formula

FCFE = NI - (CapEx - D&A) - ΔWC + Net Borrowing
  • FCFE = cash available to equity holders
  • After debt obligations and reinvestment
  • Used for dividend capacity analysis

Equity Cash Flow

Inputs
  • Net Income: 100000000 $
  • Capital Expenditures: 50000000 $
  • Depreciation & Amortization: 30000000 $
  • Change in Working Capital: 5000000 $
  • Net Borrowing: 20000000 $

$100M NI - ($50M-$30M) - $5M + $20M = $95M FCFE

Frequently asked questions

Why is FCFE important?
FCFE shows actual cash available for equity holders after all obligations - basis for dividend policy.