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The cash flow to debt ratio measures a company’s operating cash flow versus its total debt.
It is a useful tool for measuring a company’s ‘coverage,’ which looks at how well equipped a company is to meet its ongoing debt obligations (interest payments, for example) based on the amount of cash it generates through sales/service.
There are different methodologies for calculating the ratio, but the most conservative are using free cash flow as the numerator and all redeemable debt (short-term, long-term, preferred stock) as the denominator.
Generally speaking, the higher the ratio, the better.
A support line represents an estimation of where a price is likely to stop moving downwards, based on recent data in technical analysis
All-cap mutual funds invest in companies of all sizes. All-capitalization mutual funds invest in companies without a...
Cash flow is the liquid flow of cash and cash equivalents into and out of a business
Depreciation is the accounting practice of recording the decreasing value of a fixed asset, such as a building
Compounding refers to when your asset generates interest. Put simply, it’s when your earnings generate additional earnings
An open-end fund is a collective investment product where the issuer can redeem or issue shares at any time
The federal funds rate is the overnight rate at which commercial lenders lend excess reserves to other institutions
Adaptive selling is a marketing principal where the product or services offered are modified based on the demographics
A company may reinvest earnings instead of paying out dividends. They do not necessarily sit in a retained earnings account
The Consolidated Omnibus Budget Reconciliation Act (COBRA) is a federal law that mandates employers to keep you...