Question: Ignoring all other factors, will a company that is generating negative cash flows from operating activities be a good or bad investment? When evaluating a
Ignoring all other factors, will a company that is generating negative cash flows from operating activities be a good or bad investment? When evaluating a company, you notice the following on its cash flow statement: negative cash flow from operating activities, negative cash from investing activities, and positive cash flow from financing activities. A fellow student commented, “I wouldn’t invest in a company that cannot generate cash from its core business activities!” How would you answer your friend?
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