Free cash flow per share divides a company's trailing twelve-month free cash flow by its basic shares outstanding. Free cash flow is operating cash flow minus capital expenditures — the cash left over after the company has funded its operations and maintained or expanded its asset base. This is the cash available for dividends, share buybacks, debt repayment, or acquisitions.
Free cash flow per share is one of the most important metrics for equity valuation because it represents the actual cash available to shareholders after all necessary business expenditures.
Free Cash Flow Per Share = (Operating Cash Flow (TTM) − Capital Expenditures (TTM)) / Basic Shares Outstanding
GeminIQ computes TTM free cash flow as TTM operating cash flow minus TTM capital expenditures, then divides by period-end basic shares. All inputs are from SEC filings. Capital expenditures are reported as a cash outflow and GeminIQ takes the absolute value.
A: FCF per share represents the per-share cash a company generates after all operating costs and capital investments. It is the foundation of discounted cash flow (DCF) valuation models and is a better predictor of dividend sustainability than EPS because dividends are paid from cash, not accounting earnings.
A: There is no universal target — it depends on the stock price and growth expectations. A more useful metric is the free cash flow yield (FCF per share / stock price), which tells you what return the company's cash generation represents relative to the price you pay.
A: The most common source of variation is how capital expenditures are defined. Some platforms include acquisitions in capex, others exclude them. Some include purchases of intangible assets, others do not. GeminIQ uses capital expenditures as reported on the cash flow statement.