FREE TOOL · NO ACCOUNT NEEDED
FCF Yield Calculator
Calculate free cash flow yield for any stock and see how it compares to its sector. FCF Yield = (Free Cash Flow ÷ Market Cap) × 100. The bookmarkable value check for cash-flow investors.
Inputs
Results
Enter a ticker symbol to see the FCF yield
Results update instantly.
FCF yield benchmarks by sector
Typical FCF yield ranges based on Damodaran sector data and historical market averages. Capital-intensive sectors command higher yields; asset-light sectors accept lower yields for growth.
| Sector | Typical FCF Yield Range | Benchmark Used |
|---|---|---|
| Technology | 2–5% | 3% |
| Healthcare | 1.5–4% | 2.5% |
| Financials / Financial Services | 3–7% | 5% |
| Consumer Discretionary / Cyclical | 2–5% | 3% |
| Consumer Staples / Defensive | 3–6% | 4% |
| Energy | 5–10% | 7% |
| Utilities | 3–6% | 4% |
| Materials / Basic Materials | 3–6% | 4% |
| Industrials | 2–5% | 3% |
| Real Estate | 2–5% | 3% |
| Communication Services | 3–6% | 4% |
Verdict thresholds: Attractive = FCF yield ≥ 1.5× benchmark · Fair = ≥ 0.75× benchmark · Low = above 0 but below 0.75× · Negative FCF = FCF ≤ 0
Understanding FCF yield
Why cash flow beats accounting earnings
Earnings per share reflects accounting rules — depreciation, amortization, non-cash charges — all of which can be manipulated or distorted. Free cash flow is what the company actually generated in cold, hard cash after paying for the capital expenditures needed to keep the business running.
FCF yield is this cash figure expressed as a percentage of what you pay. A 6% FCF yield means for every $100 of market cap, the company produced $6 in real cash last year. That is the yield you are actually buying.
Sector benchmarks matter
A 3% FCF yield is ordinary for a technology company but low for an energy company. Capital-intensive businesses (utilities, energy, materials) tend to have higher FCF yields because cash flows are more volatile and the market demands a bigger margin of safety.
Asset-light businesses (software, platforms) often trade at low FCF yields because the market expects strong compounding — the low yield reflects a high price paid for future growth. Always compare to the sector, not to an absolute number.
FCF yield vs. P/FCF ratio
FCF yield and the price-to-FCF ratio are inverses of each other. A P/FCF of 20 is a 5% FCF yield; a P/FCF of 10 is a 10% FCF yield. FCF yield frames the answer as a return (like a bond yield), while P/FCF frames it as a multiple. Both describe the same relationship from opposite directions.
Value investors typically prefer FCF yield because it lets you compare a stock directly against bonds or other investments quoted in percent.
Where FCF yield falls short
FCF yield uses a single year of cash flow, so it reflects capex timing, working capital swings, and one-off items. A company investing heavily in growth will have depressed FCF — and a high FCF yield — in years when it is building future earning power.
Use FCF yield as a starting screen. Confirm with a DCF valuation that explicitly models growth, or check the multi-year FCF trend to ensure the yield is sustainable and not artificially inflated by underinvestment.
How to use this calculator
Enter a ticker or switch to manual
Type a US ticker to load live FCF and market cap data. Or toggle to manual mode and enter FCF in millions and market cap in millions for any company.
Read the FCF yield
FCF Yield = Free Cash Flow ÷ Market Cap × 100. A higher number means you are paying less per dollar of cash the business generates.
Check the sector benchmark
The calculator compares your result to the typical FCF yield for the company's sector. Attractive means above 1.5× the benchmark; Fair means within 75% of it.
Dig deeper on outliers
A very high FCF yield can mean either cheap value or a value trap — check the multi-year trend. A low yield may reflect justified growth premium or overvaluation.
Frequently asked questions
What is FCF yield?
FCF yield is free cash flow divided by market capitalization, expressed as a percentage. It shows how much cash a company generates relative to its market price — higher is generally better for value investors.
What is a good FCF yield?
It depends on the sector. Technology typically yields 3–5%; energy 7–10%. As a rough rule, FCF yield above the current 10-year Treasury yield suggests the stock may offer reasonable cash-flow value.
How does FCF yield differ from earnings yield?
Earnings yield uses accounting earnings (EPS ÷ price), which can be distorted by non-cash items. FCF yield uses actual cash generated after capex — harder to manipulate and a better reflection of real cash returns.
Is a negative FCF yield bad?
Negative FCF means the company is burning cash — spending more on operations and capex than it generates. That is not necessarily fatal (early-stage growth companies often burn cash intentionally), but it means the FCF yield metric is not meaningful as a value signal.
How does FCF yield relate to P/FCF ratio?
They are reciprocals. A P/FCF ratio of 20 equals a 5% FCF yield. FCF yield is the 'return framing' — useful for comparing to bond yields. P/FCF is the 'multiple framing' — useful for comparing across stocks. Both measure the same thing from different directions.
FINISHED THE NUMBERS?
A calculator gives you one number. The report gives you the argument.
Assumptions, scenarios, and what breaks them — on any public company.
See a sample report →