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How to Use Cash Flow Return on Invested Capital for Stock Picks

How to Use Cash Flow Return on Invested Capital for Stock Picks

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In this episode, Lucas and Luna dive into a fundamental metric often overlooked by retail investors: Cash Flow Return on Invested Capital, or CROIC. With the S&P 500 trading near 7,500 and small caps posting their best first half in 35 years, Lucas argues that CROIC is a powerful filter for identifying companies that generate real cash relative to the capital they tie up. They walk through how the metric works, why it matters more than earnings per share in a high-inflation environment, and how listeners can apply it to their own stock research. Luna pushes back on whether CROIC favors capital-light businesses like software over industrials, and Lucas explains how to adjust the formula for different sectors. The conversation is grounded in specific examples and live market data, including the latest moves in Apple, Microsoft, and Alphabet. #CROIC #CashFlowROIC #StockPicking #FundamentalAnalysis #ValueInvesting #CapitalAllocation #SmallCaps #MegacapTech #Apple #Microsoft #Alphabet #FexingoBusiness #BusinessPodcast #Finance #Investing #ActiveManagement #ROIC #CashFlow Keep every episode free: buymeacoffee.com/fexingo
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