Employees at all levels may need a crash
course on cash flow.
Not exact matches
To make matters even more difficult, you'll probably need to borrow money throughout the
course of your business ownership, or at least set up a line of business credit that you can draw
on to keep your
cash flow positive and moving.
During the
course of the year, monthly information
on revenue
flows is based
on cash received by the Canada Revenue Agency, the Canada Boarder Security Agency and individual departments.
A shareholder may in the
course of running the business make purchases or pay expenses with their own money
on behalf of the corporation (especially when the corporation is initially being formed and is not generating sufficient
cash flow).
The price of a fund's shares and the
cash flows you receive will depend
on the bond market's fluctuations — which are influenced by changes in interest rates — and, of
course, the manager's skill.
If you can envision that extra
cash flow becoming available for things like saving for a car, a down payment
on a house or for retirement savings, it becomes the motivation for staying
on course.
Many more options abound beyond the portfolio loan, which should not effect your
cash flow too much if you're using leverage (this of
course depends
on how drastically your interest rates are changing though).
MFC could, of
course, lose more than $ 75 million as they continue funding
cash flow negative operations but there does appear to be considerable potential upside
on these assets.
All of these risks have to be managed so you maintain your
cash flow and stay
on course to building wealth.
Of
course, the usual temptation here is to rely primarily
on quantitative analysis — let the numbers do the talking — focusing
on the consistency & sustainability of strong free
cash flow (as a % of net income), high net margins, high return
on equity (though not dependent
on excessive debt), and good return
on assets (in excess of WACC).
[Of
course, there was precious little point dwelling
on flat revenues, declining ARPU, cumulative losses, and negative free
cash flow!?
But if management can continue growing revenue, and expanding underlying divisional margins, we'd see a disproportionate impact
on consolidated operating /
cash flow margins — so in due
course, NWT could well grow into this kind of intrinsic valuation.
Many consumers do not have the kind of
cash flow needed to pay for six or twelve months» worth of coverage all at once, so they are relegated to take
on the option of the payment plan, even though it costs them more money over the
course of the coverage period.
Of
course there are other considerations, like the market drops, but if you are buying right and producing income at the outset, you should be fine (I have been in this situation for the last few years
on a SFH i have in Cleveland - i don't like it, but its still
cash flowing after they are paying my mortgage down for me).
I like
cash flow because when it increases then I increase my monthly payment
on the loan, which decreases the amount of interest I'll pay over the life of the loan, and of
course shortens the loan, which all increase my equity regardless of appreciation.
(Of
course, there are other benefits to real estate besides just the CoC Return from your
cash flows, such as tax benefits and appreciation, but I look at those as the cherry
on top.)
Yes, having to pay taxes
on you're income
on a free and clear property sucks, but you will
cash flow more of
course and it will allow you to buy more properties.
The duplex is built in 1910,
cash flows well, but has snow sitting
on the roof half the year, I have to replace the furnace already, worry about ice / snow removal, and of
course, had to pay for that frozen pipe (that goodness it didn't burst).
This is a great thing because of
course we are all
on our own journey and set our own rules but it is also frustrating because if we are only having a quick conversation, we might think each other are crazy, me for having such a high requirement that I will never find a deal and you for being so risky with such little
cash flow.
Of
course, I'm a buy and hold guy stuck
on cash flow and am not too keen
on excessive speculation
on appreciation.
Of
course, there's always the other route of preemptively knocking out the replacement
on all the galvi, but that's a pretty big cost, so you would have to factor in the
cash flow and
cash reserves situation before making that decision.
There are of
course still some ways around this... the value of any asset is still the present value of all future
cash flows from that asset and
cash flows ultimately comes from revenue so we focus
on revenue to determine value.