Cash Flow to Debt Ratio

Output: Press calculate

Formula: Cash Flow to Debt Ratio = Operating Cash Flow / Total Debt

The Cash Flow to Debt Ratio is a financial metric that assesses a company's ability to cover its debts with its operating cash flow. In this formula, operating cash flow represents the cash generated from the company’s normal business operations, and total debt refers to the total amount of a company’s financial liabilities. This ratio is an indicator of financial durability, showing how capable a company is at covering its debts with the cash it generates from its regular business operations. A higher ratio suggests a better position in terms of liquidity and financial stability. This measure is particularly useful for creditors and investors in assessing a company's financial health and risk level.

Tags: Finance, Cash Flow, Debt Management