NovoCure (NovoCure) Free Cash Flow

: $-100.4 Mil (TTM As of Dec. 2023)

View and export this data going back to 2015. Start your Free Trial

NovoCure's total free cash flow for the months ended in Dec. 2023 was $-21.4 Mil. Its total free cash flow for the trailing twelve months (TTM) ended in Dec. 2023 was $-100.4 Mil.

NovoCure's Free Cash Flow per Share for the months ended in Dec. 2023 was $-0.20. Its free cash flow per share for the trailing twelve months (TTM) ended in Dec. 2023 was $-0.94.

During the past 12 months, the average Free Cash Flow per Share Growth Rate of NovoCure was -1148.90% per year. 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.

During the past 11 years, NovoCure's highest 3-Year average Free Cash Flow per Share Growth Rate was 70.50% per year. The lowest was -23.30% per year. And the median was 3.00% per year.

NovoCure Free Cash Flow Historical Data

The historical data trend for NovoCure'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.

NovoCure Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Free Cash Flow

16.14

84.18

58.59

9.43

-100.43

NovoCure Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Free Cash Flow																-10.14	-22.82	-29.67	-26.57	-21.38

NovoCure 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.

NovoCure's Free Cash Flow for the fiscal year that ended in Dec. 2023 is calculated as

Free Cash Flow (A: Dec. 2023 )	=	Cash Flow from Operations	+	Capital Expenditure
	=	-73.336	+	-27.093
	=	-100.4

NovoCure's Free Cash Flow for the quarter that ended in Dec. 2023 is calculated as

Free Cash Flow (Q: Dec. 2023 )	=	Cash Flow from Operations	+	Capital Expenditure
	=	-14.558	+	-6.821
	=	-21.4

Free Cash Flow for the trailing twelve months (TTM) ended in Dec. 2023 adds up the quarterly data reported by the company within the most recent 12 months, which was $-100.4 Mil.

NovoCure (NAS:NVCR) 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 Dec23, NovoCure's Forward Rate of Return (Yacktman) % is

Forward Rate of Return (Yacktman) % (Dec23)	=	Normalized Free Cash Flow	/	Price	+	5-Year EBITDA Growth Rate
	=	0	/	14.93	+	0
	=	0.00 %

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.

NovoCure Free Cash Flow Related Terms

Thank you for viewing the detailed overview of NovoCure's Free Cash Flow provided by GuruFocus.com. Please click on the following links to see related term pages.

NovoCure (NovoCure) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Medical Devices & Instruments » NovoCure Ltd (NAS:NVCR) » Definitions » Free Cash Flow

Comparable Companies

Traded in Other Exchanges

038:Germany

Address

Grenville Street, No. 4 The Forum, Second Floor, St. Helier, JEY, JE2 4UF

Website

https://www.novocure.com

NovoCure Ltd serves in the healthcare sector of the United States. Its business involves the development, manufacture and commercialization of Tumor Treating Fields (TTFields) devices, including Optune and Optune Lua, for the treatment of solid tumor cancers. Its pipeline consists of Ovarian Cancer, Pancreatic Cancer, Non-Small Cell Lung Cancer, and Brain Metastasis. Products are comprised of two main components: electric field generator and arrays and related accessories. NovoCure derives its major revenues in the United States.

Executives

Pritesh Shah	officer: Chief Commercial Officer	C/O NOVOCURE INC., 20 VALLEY STREAM PARKWAY, SUITE 300, MALVERN PA 19355
Michal Nath Puri	officer: Chief Human Resources Officer	BUSINESS VILLAGE D4, PARK 6/PLATZ10, ROOT V8 6039
Wilhelmus Cm Groenhuysen	officer: Chief Financial Officer	C/O NAVTEQ CORPORATION, 222 MERCHANDISE MART STE 900, CHICAGO IL 60654
Ashley Cordova	officer: Chief Financial Officer	20 VALLEY STREAM PARKWAY,, SUITE 300, MALVERN PA 19355
Arye Barak Ben	officer: General Counsel	TOPAZ BUILDING, 4TH FLOOR, MATAM CENTER, PO BOX 15022, SH'AR HACARMEL, HAIFA L3 31905
Timothy J Scannell	director	2825 AIRVIEW BOULEVARD, KALAMAZOO MI 49002
Kristin Stafford	director	1550 LIBERTY RIDGE DRIVE, SUITE 115, WAYNE PA 19087
Frank X Leonard	officer: President, CNS Cancers US	20 VALLEY STREAM PARKWAY,, SUITE 300, MALVERN PA 19355
William Patrick Burke	officer: Chief Human Resources Officer	195 COMMERCE WAY, PORTSMOUTH NH 03801
Uri Weinberg	officer: Chief Innovation Officer	NOVOCURE INC., 20 VALLEY STREAM PARKWAY, SUITE 300, MALVERN PA 19355
Allyson J Ocean	director	1550 LIBERTY RIDGE DRIVE, SUITE 115, WAYNE PA 19087
Asaf Danziger	director, officer: Chief Executive Officer	5 NACHUM CHAT ST., TIRAT HACARMEL L3 5112302
Ely Benaim	officer: Chief Medical Officer	C/O REXAHN PHARMACEUTICALS, INC., 15245 SHADY GROVE ROAD, SUITE 455, ROCKVILLE MD 20850
William F Doyle	director, 10 percent owner
Jeryl L Hilleman	director	C/O INTERSECT ENT, INC., 1555 ADAMS DRIVE, MENLO PARK CA 94025