Bridge over ocean
21 June 2017 Multimedia

Are Cashflows Better Stock Return Predictors than Profits?

  1. Stephen R. Foerster

Although various income statement–based measures predict the cross section of stock returns, direct method cash flow measures have even stronger predictive power. 

In the article “Are Cash Flows Better Stock Return Predictors Than Profits?”, Steve Foerster, CFA, explained how he transformed indirect method cash flow statements into disaggregated and more direct estimates of cash flows from operations and other sources to form portfolios on the basis of these measures. 

This is an archived version of a live webinar hosted by CFA Society United Kingdom on 21 June 2017. 

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