InsiderFlow › Glossary › What is free cash flow?
Free cash flow is the cash left after a company pays all costs and investments: real money, hard to fake.
Accounting profit is an opinion (it depends on depreciation, provisions, estimates); cash is a fact. FCF measures how much money the business truly generates and can use for dividends, buybacks, acquisitions or debt reduction.
Many professional investors prefer valuing companies on FCF (with multiples like P/FCF or FCF yield) precisely because it's harder to manipulate than net income.
On InsiderFlow these concepts come alive on real data: what big funds and insiders are buying, explained every day.
Heavy investments, uncollected receivables or piling inventory: profit exists on paper, cash doesn't.
Free cash flow divided by market cap: 5–8% signals a company generating lots of cash relative to its price.