Financial formula guides
Browse our published financial formulas for cash flow and valuation. Each guide includes definitions, worked examples, comparisons, and a calculator.
Published formulas
Choose a formula to understand how it works and when to use it.
Free cash flow guide
Free Cash Flow Formula
Free Cash Flow = Cash from Operations − Capital Expenditures
The most common free cash flow formula subtracts capital expenditures from cash from operations. Other versions start with EBIT, EBITDA or net income and reconcile the same operating and reinvestment economics.
FCFF valuation guide
Unlevered Free Cash Flow Formula
FCFF = EBIT × (1 − Tax Rate) + D&A − Increase in NWC − CapEx
Unlevered free cash flow, also called free cash flow to the firm, removes financing effects so the cash flow represents both debt and equity capital providers.
FCFE valuation guide
Levered Free Cash Flow Formula
FCFE = Net Income + D&A − Increase in NWC − CapEx + Net Borrowing
Levered free cash flow, often modeled as free cash flow to equity, measures cash remaining for common shareholders after operating needs, reinvestment and net debt financing.