FCFY in AAII Stock Investor Pro
When it comes to stocks, I like to do my own work and if I can do reproducible research.
Purpose of the post is to show a way to get a certain financial metric that is not easy to find.
I read in an article called Forget About Dogs Of The Dow In 2019, Upgrade To Dobermans about Free Cash Flow Yield.
FCF yield is a replacement for normail stock yield or stockholders yield when doing the final sort for a dogs of the dow strategey. It is defined as
\(Free Cash Flow Yield = \frac{Free Cash Flow per Share}{Market Price Per Share}\) [1]
or the custom field that I use in AAII Stock Investor Pro
The "100 *" is ment to be to shift the decimal to the right. AAII Stock Investor Pro tends to only show two decimal points. Somes stocks have less than one percent FCFY.
The Dogs of the Dow strategy only asks one question: how cheap? And it makes a narrow comparison in delineating that by only considering dividend yields. The argument for the Dobermans is:
The Dobermans of the Dow is a better companion tool for investors, because it’s more dynamic. It starts by sorting Dow constituents by a quality metric (ROE). Then, among those higher quality names, it compares prices in a more universally applicable way (FCF yield)