Hello my dears,
since this morning we have already had a great discussion here about $CECO (+1,9%) .
In the comments I read about an FCF yield below 1 and negative free cash flow.
And I ask myself all the time.
WHAT AM I MISSING HERE?
Looking forward to a great further discussion. 😘🙈😘
💸 The four types of cash flow at CECO - simply explained
🟦 1. cash flow (operations)
2026e: USD 83.20 million
2027e: USD 106.35 million
This is the operating cash flowi.e. the money generated by the core business. It shows how much liquidity CECO generates from normal business operations - without without investments or financing.
Typical components:
- Profit
- Depreciation and amortization
- Changes in working capital
- +/- other non-cash effects
👉 Interpretation: CECO significantly increases operating cash flow. This speaks for growing profitability and better cash conversion.
🟩 2. cash flow (investing)
2026e: USD -13.00 million
2027e: USD -13.00 million
This is the investment cash flow. It includes:
- Purchases of machinery, equipment, technology (CapEx)
- acquisitions
- Sales of assets
A negative value means: CECO invests in growth or maintenance of assets.
👉 Interpretation: -13 million USD is moderate. CECO is not a capital-intensive company. The investments are controlled and plannable.
🟥 3. cash flow (financing)
2026e: USD -64.00 million
2027e: USD -68.00 million
The financing cash flow shows
- Repayment of debt
- Proceeds from new debt
- Share buybacks
- dividends
A negative value means: CECO pays back more than it raises.
👉 Interpretation: CECO is reducing its debt or returning capital to shareholders. This is often a sign of financial strength and low dependence on outside capital.
🟨 4. free cash flow (FCF)
2026e: USD 68.60 million
2027e: USD 94.13 million
Free cash flow is the most important key figure for investors:
Free cash flow=operating cash flow-investment cash flow
At CECO:
- 2026e: USD 83.20-13.00=70.20 million → Finanzen.net shows USD 68.60 million (small model deviation)
- 2027e: 106.35-13.00=93.35 million USD → shown: 94.13 million USD
👉 Interpretation: CECO generates strong, growing free cash flowwhich can be used for the following purposes:
- Debt reduction
- acquisitions
- Share buybacks
- Dividends (if introduced later)
The increase in FCF is a very positive signal.
📊 Short summary for you
👉 CECO is a cash flow-strong company with controlled investments and growing operational efficiency.
FCF yield formula
Once we have the market cap, it's simple:
FCF-Yield=Free Cash Flow / Market Cap
📌 1. calculate market capitalization
Market cap = share price ⋅ number of shares
Market cap = 55.28⋅35,641,000 = USD 1.969 billion
So around USD 1.97 billion.
For CECO:
- FCF 2026e: USD 68.60 million
- FCF 2027e: USD 94.13 million
🟦 FCF yield 2026e
68,60 / 1,969=3,48%
➡️ FCF yield 2026e: approx. 3.5%
🟩 FCF yield 2027e
94,13 / 1,969=4,78%
🧠 Interpretation for investors
- 3.5-4.8% FCF yield is solid for a company with structural growth.
- The rising FCF yield shows that CECO is becoming operationally more efficient operationally more efficient.
- If growth continues, the market could later value CECO higher (multiple expansion).
- At the same time, CECO is not capital intensivewhich improves cash conversion.
