Cash Flow from operations

ecroft · #1 Aug 23, 2006, 06:06 PM

Is it possible for a company to have a positive cash flow from operations in the same year that it has a net loss or to have a negative cash flow from operations in the same year that it has a profit?

Jamminnie · Sep 3, 2008, 10:38 AM

Is it possible for a company to have a positive cash flow in the same year it has a net lost?

AdamUTsel · Sep 3, 2008, 12:49 PM

Yes, there are three componenets to the cash flow, remember.

1. Operations (which takes into account Net Income/Loss)
2. Investing
3. Financing

A company with high net losses yet a positive cash flow are likely financed completely and are a tell-all sign to investors that this company is either in the early stages of development or has a very weak future.



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