Why Companies Crushing Cash Flow Today Could Suddenly Crash Tomorrow – The 10-Year Profit Trap You Can’t Afford to Ignore!
From this, you can see that those with high cash flow yield regularly hit 20% yield so the 23% I talk about is not something new.
In case it is not clear, this is not just small caps but US stocks in general.
Here is Kenneth French’s definition of cash flow:
The cashflow used in June of year t is total earnings before extraordinary items, plus equity’s share of depreciation, plus deferred taxes (if available) for the last fiscal year end in t-1. P (actually ME) is price times shares outstanding at the end of December of t-1.
I try to use ChatGPT to break it down for you all:
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