# P/FCF — Price to Free Cash Flow

Market cap divided by free cash flow.

## Definition

P/FCF expresses how many years of free cash flow investors are paying for the equity. The cash-based equivalent of P/E, immune to non-cash earnings distortions.

## Formula

Market Cap ÷ Free Cash Flow

## Why it matters

Free cash flow is harder to manipulate than reported earnings, so P/FCF is often the more honest valuation multiple. The inverse — FCF yield — is comparable to a bond yield and helpful when comparing equities to fixed income.

## How Standard Equity uses it

Shown as its inverse, FCF yield, in the main table.

## The metric

| Category | Valuation |
| -------- | --------- |
| Unit     | x         |

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