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A P/CF ratio is calculated by dividing a company's market capitalisation (the value of all its shares combined) by its cash flow from operations (the amount of cash generated by a company’s typical business operations). It is sometimes considered an alternative to the P/E ratio because cash flows are not impacted as significantly as earnings by accounting methods such as depreciation. A lower P/CF ratio could indicate that a stock is undervalued and a high ratio that it is overvalued.

P/CF = Value of all shares / Operating cashflow

Please note that financial analyses and ratios should not be looked at in isolation when making investing decisions.