FCF Yield (FCF to EV) is equal to Free Cash Flow / Enterprise Value.
Free Cash Flow (FCF) = cash from operations - capital expenditure. Click the following link to see the definition of Enterprise Value.
How to use the ratio
Available as a screening ratio: Yes
Available as an output column ratio: Yes (Look for it under the Valuation heading)
How to select the highest FCF Yield companies
To find companies with the highest FCF Yield set the slider from 0% to 10%.
What is a good free cash flow yield?
This is a difficult question to answer. Our best answer is it depends.
If it's a high quality company a 7% Free Cash Flow Yield may be attractive but for a small company a 15% yield may be considered good.
Be careful of looking at a single year's FCF Yield alone as working capital movements (lower inventory and or accounts receivable) may temporary increase free cash flow generation which may reverse in the following year.
Remember
All ratios are calculated on a trailing 12 months (TTM) basis.
This means the last twelve months (not the company’s financial year) is compared to the same period in the past. We do this to make sure that the screener data includes the latest, most up to date, financial results of the company.