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John Moffat.
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Noah098
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sir when the statement reads like this: “X Co’s cash flows grew at the same rate as well, but it is likely that this growth rate will reduce to 25% of the original rate for the foreseeable future.”
how do we know which cash flows is it talking about? Operating cash flows or FCF to firm?
John Moffat
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I would assume that it means the operating cash flows, but I would need to see the whole question (and know, for example, what it is they are growing at the same rate as).
As I have written in my reply to another of your questions, it is possible that (for example) the operating cash flows might grow at the same rate as the revenue, but because interest payments are likely to be fixed, the free cash flows are not going to grow at the same rate.
Noah098
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