Here's the duly corrected version: FCF Yield = FCF/EV = [OCP - Capex]/[Market Cap + (CB+NCB - C&CE)]
@Madamswer, you have got amazing clarity in thinking. Not that I seek formulas as far as investment is concerned as I believe when it comes to long term investments, it takes more than just a formula. However I do use similar matrix as a part of understanding business and their capital allocation practices. As far as FCF yield is concern, wouldn't it make more sense to use OCF before tax ( i.e to take out income tax paid from the OCF), especially when it comes to comparing FCF yield with risk free returns unless of courses the risk free return we are comparing against is net of income tax
