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Vestin Realty Mortgage II (Vestin Realty Mortgage II) Free Cash Flow

: $-7.01 Mil (TTM As of Sep. 2016)
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Vestin Realty Mortgage II's total free cash flow for the months ended in Sep. 2016 was $-2.98 Mil. Its total free cash flow for the trailing twelve months (TTM) ended in Sep. 2016 was $-7.01 Mil.

Vestin Realty Mortgage II's Free Cash Flow per Share for the months ended in Sep. 2016 was $-1,490.00. Its free cash flow per share for the trailing twelve months (TTM) ended in Sep. 2016 was $-3,313.83.

Please click Growth Rate Calculation Example (GuruFocus) to see how GuruFocus calculates Wal-Mart Stores Inc (WMT)'s revenue growth rate. You can apply the same method to get the Free Cash Flow Growth Rate using Free Cash Flow per Share data.


Vestin Realty Mortgage II Free Cash Flow Historical Data

The historical data trend for Vestin Realty Mortgage II's Free Cash Flow can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Vestin Realty Mortgage II Annual Data
Trend Dec06 Dec07 Dec08 Dec09 Dec10 Dec11 Dec12 Dec13 Dec14 Dec15
Free Cash Flow
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -0.73 -3.25 -1.65 -4.71 -5.59

Vestin Realty Mortgage II Quarterly Data
Dec11 Mar12 Jun12 Sep12 Dec12 Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16
Free Cash Flow Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -1.86 -1.13 -1.81 -1.08 -2.98

Vestin Realty Mortgage II Free Cash Flow Calculation

Free Cash Flow is considered one of the most important parameters to measure a company's earnings power by value investors because it is not subject to estimates of Depreciation, Depletion and Amortization (DDA). However, when we look at the Free Cash Flow, we should look from a long term perspective, because any year's Free Cash Flow can be drastically affected by the spending on Property, Plant, & Equipment (PPE) of the business in that year. Over the long term, Free Cash Flow should give pretty good picture on the real earnings power of the company.

Vestin Realty Mortgage II's Free Cash Flow for the fiscal year that ended in Dec. 2015 is calculated as

Free Cash Flow (A: Dec. 2015 )=Cash Flow from Operations+Capital Expenditure
=-5.565+-0.023
=-5.59

Vestin Realty Mortgage II's Free Cash Flow for the quarter that ended in Sep. 2016 is calculated as

Free Cash Flow (Q: Sep. 2016 )=Cash Flow from Operations+Capital Expenditure
=-2.98+0
=-2.98

Free Cash Flow for the trailing twelve months (TTM) ended in Sep. 2016 adds up the quarterly data reported by the company within the most recent 12 months, which was $-7.01 Mil.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Vestin Realty Mortgage II  (OTCPK:VRTB) Free Cash Flow Explanation

Free Cash Flow is very close to Warren Buffett's definition of Owner's Earnings, except that in Warren Buffett's Owner's Earnings, the spending for Property, Plant, and Equipment is only for maintenance (replacement), while in the Free Cash Flow calculation, the cost of new Property, Plant, and Equipment due to business expansion is also deducted. There, Free Cash Flow is more conservative than Owner's Earnings.

In Don Yacktman's calculation of forward rate of return, he uses Free Cash Flow for the calculation. Yacktman explained the forward rate of return concept in detail in his interview with GuruFocus. Yacktman defines forward rate of return as the normalized free cash flow yield plus real growth plus inflation.

This is what Yacktman said in his March 2012 interview - when the S&P 500 was at 1400:

If the business is stable, this calculation is fairly straightforward. For instance, on the S&P 500 we would normalize earnings. We would then calculate what percentage of those earnings are not reinvested in the underlying businesses and are therefore free. Historically, for the S&P 500, this has been just under 50% of earnings. Currently, we expect the S&P to earn about 70 on a normalized basis, a number which is far below reported earnings due to our adjusting for record high profit margins. $70 X ½ / 1400 gives you a normalized free cash flow yield of approximately 2.5%.

The historical real growth rate of the S&P 500 (companies) is about 1.5%. Assuming an inflation rate of 2.5%, the forward rate of return on an investment in the S&P 500 is about 6.5% today (2.5% free cash flow yield plus 1.5% real growth plus 2.5% inflation).

For the growth part of the Forward Rate of Return calculation, GuruFocus uses the 5-year average growth rate of EBITDA per share as the growth rate, and the growth rate is always capped at 20%. For the Free Cash Flow we use per share data averaged over seven years. The reason we use seven years is because research shows that seven years is the length of the typical business cycle.

Therefore, as of Sep16, Vestin Realty Mortgage II's Forward Rate of Return (Yacktman) % is

Forward Rate of Return (Yacktman) % (Sep16)=Normalized Free Cash Flow/Price+5-Year EBITDA Growth Rate
=0/2550+0
=0.00 %

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Be Aware

Free Cash Flow within a report period can be affected by management's decisions of capital spending. Therefore, it is important to look at long term when it comes to Free Cash Flow.


Vestin Realty Mortgage II Free Cash Flow Related Terms

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Vestin Realty Mortgage II (Vestin Realty Mortgage II) Business Description

Traded in Other Exchanges
N/A
Address
9130 W. Post Road, Suite 130, Las Vegas, NV, USA, 89148
Vestin Realty Mortgage II Inc is active in the financial services domain. The company invests in loans secured by real estate through deeds of trust or mortgages. It also invests in, acquires, manages and sells the real property and acquires entities involved in the ownership or management of the real property. Vestin functions through two segments; Investments in Real Estate Loans, and Investments in equity securities of publicly traded companies.