CFA Practice Question
Free Cash Flow to Equity is:
A. OCF - Net Payments to Debtholders + Net Payments to Preferred Stockholders
B. FCFE = Net Income - Net Capital Expenditure - Change in Net Working Capital + New Debt - Debt Repayment
C. OCF + Net Payments to Debtholders + Net Payments to Preferred Stockholders
Explanation: OCF - Net Payments to Debtholders - Net Payments to Preferred Stockholders
User Contributed Comments 2
| User | Comment |
|---|---|
| harrybay | No way it's B. You need to add back depreciation to get cash flow. A makes more sense. |
| ConnerVP1 | - (Net Capex) - (Gross Capex-Depreciation) - Capex + Depreciation |