Unlevered Free Cash Flow
A company’s unlevered free cash flow a.k.a. free cash flow to the firm, is free cash flow excluding all debt financing i.e. it assumes a company is financed purely by equity. Unlevered free cash flow excludes interest payments on debt hence it will always be higher than levered free cash flow. It is useful as an intrinsic measure of cash flows to compare companies that may be financed very differently. To calculate unlevered free cash, investors and analysts deduct tax, capex and change in working capital (current assets minus current liabilities) from EBITDA.