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NASDAQ OMX Group, Inc. (NAS:NDAQ)
Cash Flow from Investing
$-479 Mil (TTM As of Jun. 2015)

Cash Flow from Investing covers the cash a company gains or spends from investment activities in financial market and operating subsidiaries. It also includes the cash the company used for property, plant and equipment (PPE).

For the three months ended in Jun. 2015, NASDAQ OMX Group, Inc. spent $35 Mil on purchasing property, plant, equipment. It gained $0 Mil from selling property, plant, and equipment. It spent $0 Mil on purchasing business. It gained $0 Mil from selling business. It spent $145 Mil on purchasing investments. It gained $88 Mil from selling investments. It paid $0 Mil for net Intangibles purchase and sale. It paid $0 Mil for discontinued investing activities. And it paid $0 Mil for other investing activities. In all, NASDAQ OMX Group, Inc. spent $92 Mil on investment activities in financial market and operating subsidiaries for the three months ended in Jun. 2015.


Definition

Cash Flow from Investing covers the cash a company gains or spends from investment activities in financial market and operating subsidiaries. It also includes the cash the company used for property, plant and equipment (PPE).

If a company spends cash on property, plant and equipment (PPE), this will reduce their cash position. This is called Capital Expenditures (CPEX).

Likewise, if a company buys another company for cash, this will reduce their cash position.

NASDAQ OMX Group, Inc.'s Cash Flow from Investing for the fiscal year that ended in Dec. 2014 is calculated as:

NASDAQ OMX Group, Inc.'s Cash Flow from Investing for the quarter that ended in Jun. 2015 is calculated as:

NASDAQ OMX Group, Inc. Cash Flow from Investing for the trailing twelve months (TTM) ended in Jun. 2015 was -2 (Sep. 2014 ) + -59 (Dec. 2014 ) + -326 (Mar. 2015 ) + -92 (Jun. 2015 ) = $-479 Mil.

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.


Explanation

Cash flow from investing contains nine items:

1. Purchase Of Property, Plant, Equipment:
Purchase of PPE indicates the amount used to purchase property, plant, and equipment.

NASDAQ OMX Group, Inc.'s purchase of property, plant, equipment for the three months ended in Jun. 2015 was $-35 Mil. It means NASDAQ OMX Group, Inc. spent $35 Mil on purchasing property, plant, equipment.

In the capital spending for property, plant and equipment (PPE), some part of spending may be from the expansion of business. The business needs more property, plant and equipment (PPE) as it grows. Another part may be from replacement of the property, plant and equipment (PPE) of existing business. For some companies, the cash spent on replacing of the property, plant and equipment (PPE) of the existing business will be close to the depreciation of property, plant and equipment (PPE) reported in the income statement.

In Warren Buffett’s definition of “Owner’s Earnings”, he deducts the estimate of the cost of replacing the property, plant and equipment (PPE) of the existing business from cash flow from operations. The cash spent on the new property, plant, and equipment is not deducted. The reason is because these are not costs of the existing business. In his 1986 letter to shareholders, Warren Buffett wrote this about owner earnings:

"These represent (a) reported earnings plus (b) depreciation, depletion, amortization, and certain other non-cash charges...less (c) the average annual amount of capitalized expenditures for plant and equipment, etc. that the business requires to fully maintain its long-term competitive position and its unit volume....Our owner-earnings equation does not yield the deceptively precise figures provided by GAAP, since (c) must be a guess - and one sometimes very difficult to make. Despite this problem, we consider the owner earnings figure, not the GAAP figure, to be the relevant item for valuation purposes...All of this points up the absurdity of the 'cash flow' numbers that are often set forth in Wall Street reports. These numbers routinely include (a) plus (b) - but do not subtract (c)."

2. Sale Of Property, Plant, Equipment:
Sale of PPE indicates the amount gained from selling property, plant, and equipment.

NASDAQ OMX Group, Inc.'s sale of property, plant, equipment for the three months ended in Jun. 2015 was $0 Mil. It means NASDAQ OMX Group, Inc. gained $0 Mil from selling property, plant, and equipment.

3. Purchase Of Business:
Purchase of business indicates the amount used to purchase business.

NASDAQ OMX Group, Inc.'s purchase of business for the three months ended in Jun. 2015 was $0 Mil. It means NASDAQ OMX Group, Inc. spent $0 Mil on purchasing business.

4. Sale Of Business:
Sale of business indicates the amount gained from selling business.

NASDAQ OMX Group, Inc.'s sale of business for the three months ended in Jun. 2015 was $0 Mil. It means NASDAQ OMX Group, Inc. gained $0 Mil from selling business.

5. Purchase Of Investment:
Purchase of Investments represents cash outflow on the purchase of investments in securities.

NASDAQ OMX Group, Inc.'s purchase of investment for the three months ended in Jun. 2015 was $-145 Mil. It means NASDAQ OMX Group, Inc. spent $145 Mil on purchasing investments.

6. Sale Of Investment:
Sale of Investments represents cash inflow on the sale of investments in securities.

NASDAQ OMX Group, Inc.'s sale of investment for the three months ended in Jun. 2015 was $88 Mil. It means NASDAQ OMX Group, Inc. gained $88 Mil from selling investments.

7. Net Intangibles Purchase And Sale:
Net Intangibles purchase and sale means the net cash inflow received by a company that comes from the purchase and sale of intangibles. It equals the cash received from sale of intangibles minus the cash spent on purchasing intangibles.

NASDAQ OMX Group, Inc.'s net Intangibles purchase and sale for the three months ended in Jun. 2015 was $0 Mil. It means NASDAQ OMX Group, Inc. paid $0 Mil for net Intangibles purchase and sale.

8. Cash From Discontinued Investing Activities:
Cash from discontinued investing activities means the cash received by a company that comes from the discontinued investing activities.

NASDAQ OMX Group, Inc.'s cash from discontinued investing activities for the three months ended in Jun. 2015 was $0 Mil. It means NASDAQ OMX Group, Inc. paid $0 Mil for discontinued investing activities.

9. Cash From Other Investing Activities:
Cash from other investing activities means the cash received by a company that comes from other investing activities.

NASDAQ OMX Group, Inc.'s cash from other investing activities for the three months ended in Jun. 2015 was $0 Mil. It means NASDAQ OMX Group, Inc. paid $0 Mil for other investing activities.


Related Terms

Cash Flow from Operations, Cash Flow from Financing, Cash Flow for Capital Expenditures, Purchase of PPE, Sale of PPE, Purchase of Business, Sale of Business, Purchase of Investment, Sale of Investment, Net Intangibles Purchase And Sale, Cash From Discontinued Investing, Cash From Other Investing


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

NASDAQ OMX Group, Inc. Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
PurchaseOfPPE -25-21-18-55-59-42-88-87-115-140
SaleOfPPE 183100000000
PurchaseOfBusiness 000-2,999-6-190-26-112-1,1210
SaleOfBusiness 00001400000
PurchaseOfInvestment -624-1,827-80-177-623-237-533-301-480-303
SaleOfInvestment 6486201,91782621351501372500298
NetIntangiblesPurchaseAndSale 0000000000
CashFromDiscontinuedInvestingActivities 0000000000
CashFromOtherInvestingActivities -970-7740000000-10
Cash Flow from Investing -953-1,2741,858-3,149-53-118-146-128-1,216-155

NASDAQ OMX Group, Inc. Quarterly Data

Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15
PurchaseOfPPE -20-25-35-35-31-35-27-47-24-35
SaleOfPPE 0000000000
PurchaseOfBusiness 0-1,121000000-2260
SaleOfBusiness 0000000000
PurchaseOfInvestment -112-114-113-141-101-117-38-47-102-145
SaleOfInvestment 1181321061449310763353288
NetIntangiblesPurchaseAndSale 0000000000
CashFromDiscontinuedInvestingActivities 0000000000
CashFromOtherInvestingActivities 0000-7-300-60
Cash Flow from Investing -14-1,128-42-32-46-48-2-59-326-92
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