Tag: operating
-
Operating Margin: Calculation and Usage
Operating margin, also known as “operating profit margin” or “net profit margin”, is a ratio used to measure a company’s pricing strategy and operating efficiency. It is a measurement of what proportion of a company’s revenue is left over after paying for variable costs of production such as wages, raw materials, etc. A healthy operating…
-
What Is Operating Cash Flow? How To Use Operating Cash Flow?
Operating cash flow (OCF), usually more formally described in accounts as “cash inflow from operating activities”, is the amount of actual cash made by a company’s business, generally defined as revenues less all operating expenses, but calculated through a series of adjustments to net income. The OCF can be found on the statement of cash…
-
What Is Price/Cash Flow Ratio?
The price/cash flow ratio (also called price-to-cash flow ratio or P/CF), is a ratio used to compare a company’s market value to its cash flow. Because this measure deals with cash flow, the effects of depreciation and other non-cash factors are removed. Similar to the price-earnings ratio, this measures provides an indication of relative value.…