Free Cash Flow to Equity Calculator

What is Free Cash Flow to Equity (FCFE)?

Free Cash Flow to Equity (FCFE) measures the amount of cash available to a company's equity shareholders after paying all operating expenses, taxes, working capital investments, capital expenditures, and net debt principal repayments.

FCFE Calculation Formula

FCFE can be computed using two primary methods depending on financial data availability:

• From Net Income: $$\text{FCFE} = \text{Net Income} + \text{D\&A} - \Delta\text{Working Capital} - \text{CapEx} + (\text{Debt Issued} - \text{Debt Repaid})$$
• From Operating Cash Flow: $$\text{FCFE} = \text{Operating Cash Flow} - \text{CapEx} + \text{Net Borrowing}$$

FCFE vs FCFE vs FCFF

While Free Cash Flow (FCF) measures overall cash flow from operations, and FCFF measures cash available to all capital providers (both debt and equity holders), FCFE specifically targets cash belonging strictly to equity shareholders after debt service obligations are fulfilled.