Understanding working capital as a small business owner can help you grow your business or take advantage of bigger opportunities.

Companies need capital to remain operational and grow, and the amount of capital a company has is a strong indicator of its financial health. Working capital can be divided into two categories: gross ...

This article is part of a continuing series on recurring issues of critical importance to sellers in private company M&A. Previous topics include equity rolls. Net Working Capital (“NWC”) targets and ...

Net working capital (“NWC”) is often a highly scrutinized component in M&A deals and can significantly impact the purchase price. NWC represents the liquidity a company needs to run its day-to-day ...

Working capital is the amount of money a company has available in short-term liquid assets. It determines a company’s immediate liquidity and is often used to manage cash flow and for other forms of ...

When acquiring or selling a company, many nuances exist in various stages of the process, some of which are not readily apparent on their face. One of those nuances is the interplay between accounts ...

Gregory Milano is founder and CEO of Fortuna Advisors LLC and author of Curing Corporate Short-Termism, Future Growth vs. Current Earnings. Many executives, especially those with a finance background, ...

Textbooks and financial courses often state that a healthy balance sheet is characterized by, among other things, positive net working capital. Conversely, negative working capital may indicate ...

A business can have great products, strong sales, and even loyal customers, but without enough working capital, things can quickly stall. Better management of working capital can improve a company's ...

On February 20, 2025, Morningstar.com released an enhanced methodology for Free Cash Flow. Free cash flow represents a company's operating cash flow net of changes in net working capital and capital ...

Cash flow from operations represents the latest cash flow from operating activities (TTM) before changes in working capital. It is calculated considering net cash flow from operating activities and ...