Marco Bozem
Independent hard-asset investor. Covers shipping, mining & energy dividends from a real private-investor portfolio.
MB Capital Strategies Glossary — Updated June 2026
Free Cash Flow (FCF) is the cash a company has left after paying for operations and capital expenditures. It is the real fuel behind dividends — a company cannot pay more in dividends than it generates in cash, regardless of what the income statement shows.
Operating cash flow comes from the cash flow statement (not the income statement). Capex includes maintenance spending and growth investments. The difference is the free cash available to return to shareholders.
Earnings per share (EPS) can be distorted by non-cash items that do not affect actual cash generation. In shipping and resource stocks, three common distortions make EPS unreliable:
FCF strips away these distortions and shows actual cash available for dividends.
FCF yield tells you how much cash the company generates relative to its market value. A high FCF yield suggests the stock is cheap relative to its cash generation — often a signal that the dividend is well-covered and potentially growing.
Not all capex is equal. Maintenance capex keeps existing assets running (fleet dry-docking, mine sustaining costs). Growth capex expands capacity (new vessels, mine expansion). For dividend assessment, use operating FCF minus maintenance capex only — this is sometimes called distributable cash flow or adjusted FCF.
Independent hard-asset investor. Covers shipping, mining & energy dividends from a real private-investor portfolio.