Free cash flow yield
Free cash flow divided by market capitalisation: how much flow falls to each unit invested in the shares.
Formula
Stored as a fraction of one rather than a percentage. The numerator is taken over a trailing year from the consolidated accounts.
How to read the number
Directly comparable with bond yields: it shows what the business is able to hand its owner, not what it has decided to hand over.
When the metric lies
Also known as: fcf yield