Hi Victor, may I know what’s your take on subtracting the share-based compensation expense from the OCF when calculating FCF? I’ve read online and many have advised to minus off the expense, as it ultimately impacts the company’s value.
If you are using the diluted outstanding shares then subtraction is not required as it have account the possible future dilution.
If you are using basic outstanding shares then use the method that you have just mentioned. Basic outstanding shares does not account for future dilution.
Hope this helps :)
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