Goldman: Misleading Accounting Makes Free Cash Flow Yield Irrelevant

HFA Padded
Rupert Hargreaves
Published on
Updated on

The S&P 500 may look expensive on most traditional valuation metrics, however, according to Goldman Sachs due to a record low level of capital spending; the index appears attractive when valued on free cash flow yield. Indeed, according to a recent research report from the investment bank, capital expenditure as a percentage of cash flow from operations ranks in just the fifth historical percentile since 1990. These Behavioral Biases Are Driving Investor Decisions Switching Costs: The More the Better More Mutual Funds Launched This Year Than ETFs The report goes on to argue that valuing companies according to free cash flow…

This content is exclusively for paying members of Hedge Fund Alpha

Insider Strategies and Letters to Shareholders from the Top Hedge Funds and Maximize Your Portfolio Growth with Hedge Fund Alpha

Don’t have an account?

Subscribe now and get 7 days free!
This article is only available for Premium Members
Subscribe today and get :
Insider Strategies and Letters to Shareholders from the Top Hedge Funds
Exclusive Access to coverage of Private, Closed-Door Investor Conferences
Hedge Fund Manager Research Currently Producing 21% – 40% Returns Annually

Don’t have an account?

Subscribe now and get 7 days free!
HFA Padded

Sign up now and get our in-depth FREE e-books on famous investors like Klarman, Dalio, Schloss, Munger Rupert is a committed value investor and regularly writes and invests following the principles set out by Benjamin Graham. He is the editor and co-owner of Hidden Value Stocks, a quarterly investment newsletter aimed at institutional investors. Rupert owns shares in Berkshire Hathaway. Rupert holds qualifications from the Chartered Institute For Securities & Investment and the CFA Society of the UK. Rupert covers everything value investing for ValueWalk