Alcoa Enterprise Value vs Free Cash Flow Analysis

    Enterprise Value vs Free Cash Flow

    Enterprise Value

    Enterprise Value (or EV) is usually referred to as Alcoa theoretical takeover price. In the event of an acquisition, an acquirer would have to take on Alcoa debt, but would also pocket its cash. Enterprise Value is more accurate representation of Alcoa value then its market capitalization because it takes into account all of Alcoa Corporation existing debt. Enterprise value is a measure of the value of a business as a whole, calculated as Market Capitalization plus Total Debt USD minus Cash and Equivalents USD.

    Free Cash Flow

    Free Cash Flow is a measure of financial performance calculated as Net Cash Flow from Operations minus Capital Expenditure.

    Accounts Relationship

    Enterprise Value vs Free Cash Flow

    Significance: Significant Contrarian Relationship

    Overlapping area represents amount of trend that can be explained by analyzing historical patterns of Alcoa Enterprise Value account and Free Cash Flow

    Correlation Coefficient

    -0.22
    Relationship DirectionNegative 
    Relationship StrengthInsignificant