Title:
Cash Flow Trends in Several Technology Industries
Cash Flow Trends in Several Technology Industries
Author(s)
Mulford, Charles W.
Surani, Sohel
Surani, Sohel
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Abstract
The Cash Flow Growth Profile(TM) measures the capacity of a firm to generate cash flow as it
grows revenue. The metric is forward looking and reports the amount of incremental cash flow
that can be expected for any measured amount of growth in revenue. In this report, using data
obtained through the second quarter of 2008, we examine the Cash Flow Growth ProfileTM of
five technology industries: computer hardware, computer software, information technology
services, telecommunications equipment, and semiconductors and related capital equipment.
We look at trends in the Profile for the industries and for 59 individual companies. In
examining the Cash Flow Growth Profile(TM), the drivers or determinants of core operating cash
flow and free cash flow are highlighted.
Looking at the industry data, there is little evidence of a decline in operating performance
through the second quarter of 2008. Indeed, only two industries, Computer Hardware and
Information Technology Services saw declines in their Free Cash Growth Profile(TM) for the
twelve months ending with the second quarter of 2008 from the same period in 2007.
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Date Issued
2009-01
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Text
Resource Subtype
Technical Report