Unlevered Free Cash Flow Vs Levered. Levered and unlevered free cash flow are concepts that stem from the term free cash flow. Levered free cash flow, on the other hand, works in favor of the business that didn’t borrow any capital and doesn’t necessarily show a comparative analysis of each company’s ability to generate cash flow on an ongoing basis.
Leverage is another name for debt , and if cash flows are levered, that means they are net of interest payments. Levered cash flow is the amount of cash a business has after it has met its financial obligations. Unlevered free cash flow is the gross free cash flow generated by a company.
Unlevered free cash flow vs.
Levered free cash flow is considered to be an important metric from the perspective of the investors. Levered free cash flow assumes. Why you should compare levered and unlevered cash flows It is also thought of as cash flow after a firm has met its financial obligations.
