Return of Capital - Conclusions

Conclusions

  • Cash flows do not measure income. They measure only cash flows!
  • Depreciation, depletion and amortization cannot be ignored as "non-cash expenses". They are valid allocations of a one-time cash flow over the time period that the asset helps generate revenues.
  • In the process of normalizing rates of return between different investment opportunities, ROC should not be included in the consideration of 'income' or 'dividends'.

Read more about this topic:  Return Of Capital

Famous quotes containing the word conclusions:

    “What is the good of drawing conclusions from experience? I don’t deny we sometimes draw the right conclusions, but don’t we just as often draw the wrong ones?”
    —G.C. (Georg Christoph)

    “That which is required in order to the attainment of accurate conclusions respecting the essence of the Beautiful is nothing more than earnest, loving, and unselfish attention to our impressions of it.”
    —John Ruskin (1819–1900)

    “In the dime stores and bus stations,
    People talk of situations,
    Read books, repeat quotations,
    Draw conclusions on the wall.”
    —Bob Dylan [Robert Allen Zimmerman] (b. 1941)