Operating cash flow to sales ratio

Operating cash flow to sales ratio,

Definition of Operating cash flow to sales ratio:

  1. Percentage measure of a firms ability to convert sales into cash, and an important indicator of its creditworthiness and productivity. A high number means the firm will be able to grow because it has sufficient cash flow to finance additional production, a low number indicates the opposite. Formula: Cash flows from operating-activities x 100 ÷ Sales revenue.

Meaning of Operating cash flow to sales ratio & Operating cash flow to sales ratio Definition