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Free cash flow is the excess cash flow from operating Activities

Free cash flow is the excess cash flow from operating activities less capital expenditure Jesen 1986 Company may use free cash flow to invest and upgrade the existing assets in order to maintain its survival in operation and generate future revenue for company growth However overinvestment will bring company to go bankruptcy Investors not only rely on financial ratio to analysis the performance of the company they also need to evaluate the management how to use internal operating cash flow to improve company value 1 2 Research Objective There were many researches to investigate the relationship between free cash flow and performance of listed companies in difference countries such as Taiwan Wang 2010 Tehran Heydari et al 2014 Karachi Ambreen and Aftab 2016 The objective of this research tries to make investors have better understanding in the relationship between free cash flow and the performance of Hong Kong listed company at the Hong Kong Stock Exchange The performance of the company can be analysis with the company financial ratio The most common financial ratio analysis are profitability liquidity solvency and operating efficiency This research objective is to find out the relationship between the free cash flow and the company's financial performance Whether the companies can use the free cash flow effectively to increase company's profitability and provide a return on shareholders investment Ambreen Afrab 2016 Whether the company's financial flexibility meet its financial obligation on a timely basis in unexpected changes of its free cash flow Kangarlouei et al 2014 



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