➊ Start with Net Income — Begin from the income statement profit.
➋ Add Back Non-Cash Costs — Include depreciation and amortization.
➌ Track Working Capital Changes — Observe shifts in receivables, payables, and inventory.
➎ Assess Operating Cash Flow — Measure cash from core operations.
➏ Review Investing Activities — Analyze cash used for or generated by assets.
➐ Evaluate Financing Activities — Examine loans, dividends, and buybacks.
➑ Calculate Free Cash Flow (FCF) — Operating cash flow minus capital expenditures.
➒ Check Net Cash Movement — Identify overall increase or decrease in cash.
➓ Compare Periods & Integrate — Spot trends and align with the income statement and balance sheet.
