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Glossary > OCF / EPS TTM

Operating Cash Flow / EPS, Trailing 12m

What does OCF / EPS TTM mean?

This ratio compares operating cash flow per share (i.e. operating cash flow divided by the number of shares used to calculate EPS) with reported EPS.

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p> It is a measure of cash conversion, i.e. the proportion of profits that are converted to cash flow.



Stockopedia explains OCF / EPS TTM...

A good way to evaluate quality is to compare operating cash flow per share to reported EPS. If it is greater than 1, this means that operating cashflow is greater than reported EPS, suggesting that earnings are of a high quality because the company is generating more cash than is reported on the income statement.

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p> It can also be less than 0, i.e. a company can show a positive earnings on the income statement while also bearing a negative cash flow.