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How to calculate the price-to-free cash flow ratio

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Cash flow ratio

The Price-to-Free Cash Flow (P/FCF) ratio compares a company’s market price to its free cash flow (FCF). It is used to assess how much investors are paying for each rupee of a company’s free cash flow, which is a critical indicator of financial health and sustainability.Formula: Price-to-Free Cash Flow = Market price per share/Free cash flow per share



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