Valuation of Firm through CVFCFF and CVFCFE as New Models Based on Free Cash Flow

Free Cash Flow (FCF) is one of the measures based on cash flow for measuring performance of firms, among various evaluation measure of performance; that indicates the cash of firm after doing necessary expenditures for keeping and developing properties. Due to that, various models based on FCF have been explained for evaluation of firms in which free cash flow to firm (FCFF) and Free Cash Flow to Equity (FCFE) can be considered as the important ones. This paper aims to give new models of Free Cash Flow. These models are called Created Value from Free Cash Flow to Firm (CVFCFF) and Created Value from Free Cash Flow to Equity (CVFCFE), that has been given by Meysam Kaviani (2013) and it is expected to provide suitable content of information for beneficiaries to evaluate the performance and various financial and investment decisions in firms.

Valuation, Cash Flow, FCF, CVFCFF, CVFCFE