cash flow coverage ratios

cash flow coverage ratios definition - finance
Cash flow analysis tools that add back certain expenses that are normally deducted to arrive at net income, such as adding back interest expense because it was already subtracted to obtain net income. Because earnings and cash flow may vary significantly, cash flow coverage ratios may be more important indicators of a companyÂ’s financial condition than earnings. See also cash flow to long-term debt ratio.

Webster's New World Finance and Investment Dictionary Copyright © 2003 by Wiley Publishing, Inc., Indianapolis, Indiana.
Used by arrangement with John Wiley & Sons, Inc.

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