How do I calculate FCFF using this calculator’s inputs (EBIT, tax rate, D&A, CapEx, and change in net working capital)?

Enter EBIT and your effective tax rate; the calculator computes NOPAT as [math]text{NOPAT} = text{EBIT}times(1-text{Tax Rate})[/math] then applies [math]text{FCFF} = text{EBIT}times(1-text{Tax Rate}) + text{D&amp;amp;A} - text{CapEx} - Delta text{NWC}[/math] where D&amp;amp;A is added back, CapEx and the change in net working capital are subtracted.

For “Change in Net Working Capital”, should I input increases as positive or negative?

Treat an increase in net working capital as a positive number (it uses cash and reduces FCFF) and a decrease as a negative number (it releases cash and boosts FCFF).

How should I interpret the FCFF Health label (e.g., “Moderate FCFF vs Reinvestment”)?

The label compares your FCFF to the level of reinvestment implied by CapEx and working capital: higher FCFF relative to reinvestment means more cash available to debt and equity holders, while a low or thin FCFF means most cash is tied up funding operations and growth.

What’s the practical difference between FCFF from this tool and free cash flow to equity (FCFE)?

FCFF here is unlevered free cash flow available to all capital providers before interest and debt repayments; FCFE adjusts FCFF for after-tax interest and net borrowing to show only the cash left for equity holders.

FCFF Calculator – Free Cash Flow to Firm (Unlevered FCF) Online Tool

Free Cash Flow to Firm (FCFF) Calculator

Compute Free Cash Flow to Firm (FCFF) from EBIT, tax rate, depreciation & amortization, capital expenditures, and changes in net working capital. Clean UX with focused inputs, practical scenarios, and a concise What It Means panel.

EBIT (Operating Income)

Tax Rate

Depreciation & Amortization (D&A)

Change in Net Working Capital

Capital Expenditures (CapEx)

Results

Free Cash Flow to Firm (FCFF) $
FCFF Health
NOPAT (EBIT × (1 − Tax Rate)) $
Operating Cash Flow (approx.) $
Depreciation & Amortization (D&A) $
Change in Net Working Capital $
Capital Expenditures (CapEx) $

What is Free Cash Flow to Firm (FCFF)?

Free Cash Flow to Firm (FCFF) is the after-tax operating cash flow available to all capital providers—both debt and equity—after covering necessary reinvestment in fixed assets and net working capital. It is the core cash flow used in discounted cash flow (DCF) valuation, links directly to enterprise value via the cost of capital, and separates operating performance from financing decisions (leverage, interest expense, dividends, and buybacks).

Formula

Example

Assume a company reports:

EBIT (Operating Income): $300,000
Tax Rate: 25%
Depreciation & Amortization (D&A): $80,000
Capital Expenditures (CapEx): $150,000
Increase in Net Working Capital: $20,000

Step 1: Compute after-tax operating income (NOPAT):

Step 2: Apply the FCFF formula:

An FCFF of $135,000 means the firm generates $135,000 of unlevered free cash flow this period that is available to both debtholders and shareholders, after funding its operating reinvestment needs.

How to Use the Cash Flow to Firm (FCFF) Calculator

Use this calculator to estimate unlevered free cash flow based on operating earnings, taxes, non-cash charges, and reinvestments in CapEx and working capital.

Enter EBIT (Operating Income)
- Input your latest EBIT from the income statement in the “EBIT (Operating Income)” field; this is profit before interest and taxes.
Set the Tax Rate
- Enter your effective corporate tax rate (as a percentage) in the “Tax Rate” field so the tool can compute after-tax operating profit (NOPAT).
Add D&A, CapEx, and Change in Net Working Capital
- - Fill in “Depreciation & Amortization (D&A)”, “Capital Expenditures (CapEx)”, and “Change in Net Working Capital”; the calculator then applies
Review the Results Table
- Check the “Results” section to see FCFF, the FCFF Health label, NOPAT, operating cash flow approximation, and the components you entered for a clear breakdown.
Use the Summary Card and Scenarios
- Read the bottom summary card showing “Free Cash Flow to Firm (FCFF)” and its health assessment, and optionally adjust inputs (or use predefined scenarios if available) to compare how different assumptions change FCFF.

Frequently Asked Questions

Enter EBIT and your effective tax rate; the calculator computes NOPAT as then applies where D&amp;amp;A is added back, CapEx and the change in net working capital are subtracted.
Treat an increase in net working capital as a positive number (it uses cash and reduces FCFF) and a decrease as a negative number (it releases cash and boosts FCFF).
The label compares your FCFF to the level of reinvestment implied by CapEx and working capital: higher FCFF relative to reinvestment means more cash available to debt and equity holders, while a low or thin FCFF means most cash is tied up funding operations and growth.
FCFF here is unlevered free cash flow available to all capital providers before interest and debt repayments; FCFE adjusts FCFF for after-tax interest and net borrowing to show only the cash left for equity holders.

Methodology & Sources

Bibliography

CFA Institute Curriculum Team (2025). Free Cash Flow Valuation (CFA Program Level II – Equity Valuation) — CFA Institute https://www.cfainstitute.org/insights/professional-learning/refresher-readings/2025/free-cash-flow-valuation
Accessed 2025-12-10
Aswath Damodaran (2012). Investment Valuation: Tools and Techniques for Determining the Value of Any Asset, 3rd ed. – Chapter 15 “Firm Valuation: Cost of Capital and Adjusted Present Value Approaches” — John Wiley & Sons / NYU Stern School of Business https://pages.stern.nyu.edu/~adamodar/pdfiles/val3ed/c15.pdf
Accessed 2025-12-10

Free Cash Flow to Firm (FCFF) Calculator

Results

What It Means

What is Free Cash Flow to Firm (FCFF)?

Formula

Example

How to Use the Cash Flow to Firm (FCFF) Calculator

Enter EBIT (Operating Income)

Set the Tax Rate

Add D&A, CapEx, and Change in Net Working Capital

Review the Results Table

Use the Summary Card and Scenarios

Frequently Asked Questions

Methodology & Sources

Bibliography

Other Calculators in Corporate Finance & Analysis

Weighted Average Cost of Capital (WACC) Calculator

Discounted Cash Flow (DCF) Calculator

Enterprise Value Calculator

Free Cash Flow to Equity (FCFE) Calculator

Cost of Debt Calculator

Capital Employed Calculator