Drop in Free Cash Flow Raises Concerns
Everybody loves a good story
Free Cash Flow/Net Income Ratio Declined in 1Q 2022
Free Cash Flow/Net Income Ratio Declined in 1Q 2022
Investors who focus solely on earnings
Drivers of the Free Cash Flow Margin
Companies with Lower Capex to Revenue Ratios Outperform
We’d note that this analysis does not include regulated utilities for a reason
Competition isn’t the only cause
Companies with Strong Free Cash Flow Margins Have Seen Faster Revenue Growth
High Free Cash Flow Margins Have Outperformed High Free Cash Flow Yields
Our view at Miller/Howard is that the market’s focus on free cash flow has been correct
Amazon’s Free Cash Flow Margin Has Gone Negative
The story is simple
Amazon’s Non-Cash Working Capital and Capital Spending Are Growing Faster than Revenue
Change in Gross Margin by Industry
Free Cash Flow Margin by Industry
As previously discussed, aggregate free cash flow margins are down substantially
Free Cash Flow Margin by Industry
At Miller/Howard we believe
Some investors may wonder
Miller/Howard Investments - Disclosure