Harlan D. Platt
Abstract
Four concepts of cash flow are discussed and compared: simple cash flow, operating activities cash flow, net operating profit after taxes, and free cash flow. The differences between these concepts are shown to be very large. Issues connected to terminal value are presented. Finally, the idea of not having to change WACC over time is discussed.
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Four concepts of cash flow are discussed and compared: simple cash flow, operating activities cash flow, net operating profit after taxes, and free cash flow. The differences between these concepts are shown to be very large. Issues connected to terminal value are presented. Finally, the idea of not having to change WACC over time is discussed.
Key concepts: Cash flow, Terminal value, Cash on cash return, Operating cash flow, Free cash flow, Net present value, Cash flow statement, Cash and cash equivalents