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GuruFocus has detected 4 Warning Signs with Bank of America Corporation $BAC.
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Bank of America Corporation (NYSE:BAC)
Cash Flow from Operations
$18,306 Mil (TTM As of Dec. 2016)

Cash flow from operations refers to the cash brought in through a company’'s normal business operations. It is the cash flow before any investment or financing activities. It is the cash version of net income.

For the three months ended in Dec. 2016, Bank of America Corporation's Net Income From Continuing Operations was $4,696 Mil. Its DDA was $549 Mil. Its Change In Working Capital was $-18,314 Mil. Its cash flow from deferred tax was $769 Mil. Its Cash Flow from Discontinued Operations was $0 Mil. Its Stock Based Compensation was $148 Mil. And its Cash Flow from Others was $3,796 Mil. In all, Bank of America Corporation's Cash Flow from Operations for the three months ended in Dec. 2016 was $-8,356 Mil.


Definition

Cash flow from operations refers to the cash brought in through a company’'s normal business operations. It is the cash flow before any investment or financing activities. It is the cash version of net income.

Bank of America Corporation's Cash Flow from Operations for the fiscal year that ended in Dec. 2016 is calculated as:

Bank of America Corporation's Cash Flow from Operations for the quarter that ended in Dec. 2016 is

Bank of America Corporation Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2016 was 10843 (Mar. 2016 ) + 15293 (Jun. 2016 ) + 526 (Sep. 2016 ) + -8356 (Dec. 2016 ) = $18,306 Mil.

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.


Explanation

Cash flow from operations contains six items:

1. Net Income From Continuing Operations:
Net Income From Continuing Operations indicates the net income that a firm brings in from ongoing business activities. These activities are expected to continue into the next reporting period. It excludes extraordinary items, income from the cumulative effects of accounting changes, non-recurring items, income from tax loss carry forward, and preferred dividends.

Bank of America Corporation's net income from continuing operations for the three months ended in Dec. 2016 was $4,696 Mil.

2. Depreciation, Depletion and Amortization:
Depreciation is a present expense that accounts for the past cost of an asset that is now providing benefits.
Depletion and amortization are synonyms for depreciation.
Generally:
• The term “depreciation” is used when discussing man made tangible assets
• The term “depletion” is used when discussing natural tangible assets
• The term “amortization” is used when discussing intangible assets

Bank of America Corporation's depreciation, depletion and amortization for the three months ended in Dec. 2016 was $549 Mil.

3. Change In Working Capital:
Working Capital is a measure of a company's short term liquidity or its ability to cover short term liabilities. It is defined as the difference between a company's current assets and current liabilities. Changes in Working Capital is reported in the cash flow statement since it is one of the major ways in which net income can differ from operating cash flow.

Bank of America Corporation's change in working capital for the three months ended in Dec. 2016 was $-18,314 Mil. It means Bank of America Corporation's working capital declined by $18,314 Mil from Sep. 2016 to Dec. 2016 .

4. Deferred Tax:
It is the cash flow generated from deferred tax.

Bank of America Corporation's cash flow from deferred tax for the three months ended in Dec. 2016 was $769 Mil.

5. Cash Flow from Discontinued Operations:
Cash received by a company that comes from the sale of part of business.

Bank of America Corporation's cash flow from discontinued operations for the three months ended in Dec. 2016 was $0 Mil.

6. Stock Based Compensation:
It is a way corporations use stock options to reward employees. It provides executives and employees the opportunity to share in the growth of the company and, if structured properly, can align their interests with the interests of the company's shareholders and investors, without burning the company's cash on hand.

Bank of America Corporation's stock based compensation for the three months ended in Dec. 2016 was $148 Mil.

7. Cash Flow from Others:
These are cash differences caused by the change of inventory, accounts payable, accounts receivable etc. For instance, if a company pays its suppliers slower, its cash position will build up faster. If a company receives payments from its customers slower, its account receivables will rise, and its cash position will grow more slowly (or even shrink).

Bank of America Corporation's cash flow from others for the three months ended in Dec. 2016 was $3,796 Mil.


Related Terms

Net Income From Continuing Operations, Depreciation, Depletion and Amortization, Change In Working Capital, Cash Flow from Discontinued Operations, Stock Based Compensation, Cash Flow from Others, Cash Flow from Investing


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Bank of America Corporation Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
NetIncomeFromContinuingOperations 14,9824,0086,276-2,2381,4464,18811,4314,83315,88817,906
CF_DDA 2,8443,3194,3143,9123,4853,0382,6832,5222,3892,241
ChangeInWorkingCapital -19,773-32,24971,77440,05752,336-29,96356,10518,7036,480-14,703
CF_DeferredTax -753-5,801370608-1,949-2,7353,2627263,1085,841
Cash Flow from Disc. Op. 0000000000
Stock Based Compensation 000000078281,235
Cash Flow from Others 13,73634,75746,99740,2559,17211,61419,336-123-1635,786
Cash Flow from Operations 11,0364,034129,73182,59464,490-13,85892,81726,73927,73018,306

Bank of America Corporation Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
NetIncomeFromContinuingOperations 3,0503,3575,3204,5082,7032,6804,2326,2984,6964,856
CF_DDA 642608603595583566562564549162
ChangeInWorkingCapital -1,247-9,354-17,88632,6871,0331,9409,292-7,621-18,3140
CF_DeferredTax 1722281,4451,3071281,2181,0002,8547690
Cash Flow from Disc. Op. 0000000000
Stock Based Compensation 01413-10118311311251480
Cash Flow from Others -2,9294552,554-4,1851,0133,60876-1,6943,7960
Cash Flow from Operations -312-4,692-7,95134,9025,47110,84315,293526-8,3560
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