Definition · cash flow
Unlevered free cash flow
Unlevered free cash flow is cash available to all capital providers before debt service, commonly used with WACC to value the enterprise. For unlevered free cash flow, the useful boundary is the cash source, timing horizon, owner, liquidity exposure, and decision before options narrow.
Also known as FCFF, free cash flow to firm, unlevered FCF
Why it matters
Understanding unlevered free cash flow matters because cash decisions are time-sensitive. Teams need to know when money moves, which balance changes, who owns the next action, and what can still be changed before liquidity tightens. Pluvo computes unlevered free cash flow consistently across periods and entities, so valuation and planning start from a number that reconciles to the ledger.
In practice
Liquidity example
Finance teams use unlevered free cash flow when they need to understand cash timing before a decision is made. A team might compare expected receipts, payroll, vendor payments, and debt obligations to decide what action is needed this week.
Pluvo example
Pluvo computes unlevered free cash flow consistently across periods and entities, so valuation and planning start from a number that reconciles to the ledger.
In practice, teams should define unlevered free cash flow with a clear source, owner, time period, and decision before they use it in reporting, planning, or operating reviews.
Understanding unlevered free cash flow matters because cash decisions are time-sensitive. Teams need to know when money moves, which balance changes, who owns the next action, and what can still be changed before liquidity tightens. Pluvo computes unlevered free cash flow consistently across periods and entities, so valuation and planning start from a number that reconciles to the ledger.
A strong workflow for unlevered free cash flow separates the definition from the action: first agree what the term means, then decide how it is measured, when it changes, and who is accountable for the next step.
Pluvo computes unlevered free cash flow consistently across periods and entities, so valuation and planning start from a number that reconciles to the ledger.
FAQ
What is unlevered free cash flow?
Unlevered free cash flow is cash available to all capital providers before debt service, commonly used with WACC to value the enterprise. For unlevered free cash flow, the useful boundary is the cash source, timing horizon, owner, liquidity exposure, and decision before options narrow.
What is the difference between levered and unlevered free cash flow?
The boundary for unlevered free cash flow differs from related terms by scope, source data, time period, and decision use. In this glossary, it covers unlevered free cash flow (FCFF): cash available to all capital providers before debt service, and its use with WACC to value the enterprise, so teams should compare those boundaries before using it in reporting or planning.