Legg Mason's Chief Strategiest Michael J. Mauboussin discussses why cashflow is more important than earnings: "Cash is a fact, profit is an opinion."
• A company’s value equals the present value of future cash flows.
• While convenient, earnings provide limited information about future cash flows.
• Our analysis of the DJIA suggests cash flows remain very healthy.
• The ongoing shift to an intangible-based economy renders earnings even less
Read the complete report
• A company’s value equals the present value of future cash flows.
• While convenient, earnings provide limited information about future cash flows.
• Our analysis of the DJIA suggests cash flows remain very healthy.
• The ongoing shift to an intangible-based economy renders earnings even less
Read the complete report