Thank you, I’m glad you liked the session [quote=“NewInvestor, post:5, topic:11894”]
Can a negative cash flow from operating expenses ever be a good thing? Especially if it happens more than once or twice in the last 5-10 fiscal years?
I personally dont like investing in such companies. When I invest in a stock for a long term, I expect to see stable, long term +ve CF from operations. However, there are companies on the verge of raising from the lows (from consistent -ve CF to turning +ve), hard to find, but if you do, can be a stellar investment[quote=“NewInvestor, post:5, topic:11894”]
Generally, we should prefer a company that is on a growing trajectory, this would mean that it keeps on investing in itself. This is especially true for small/mid cap companies that have enough room for growth. Now in such a case, if the company shows a net inflow of cash from investing activities (positive IA CF), is that a bad sign in general implying that the company isn’t being aggressive enough?
Look for the CF from IA and correlated to what the managenment has to say in Management Discussion & Analysis. If the management is talking about investments and CAPEX expansion but the CF from IA is not impressing, then thats something you need to watch out for [quote=“NewInvestor, post:5, topic:11894”]
Can we get the 10 year cash flow data from Annual Reports? I use Screener or Ratestar for now. Did you have to manually enter all that info into Excel?
I extracted it from screener too, expecting the numbers to be accurate. However, you can visit the companies website (look under the investors section) and download the ARs and therefore the historical CF numbers[quote=“NewInvestor, post:5, topic:11894”]
Pardon the noob questions, I’ve only begin with direct equity investments. Thanks again for your work on this session and Varsity!
Good luck and happy investing!