Description
1. If a company does not generate free cash flow or if cash flow is trending lower the owner should evaluate operating decisions including how they are going to fund a project or invest in PP&E (property, plant, and equipment). Does anyone have any insight regarding free cash flow and why this influences decisions made using net present value, internal rate of return, and payback methods? (No quotes, 100 words)2. I am working with a global energy provider and they’re in the process of evaluating prior long-term investment decisions in property, plant, and equipment. Specifically, they invested in their energy grid, transmission lines, wind projects, and carbon capture technology. The process involves evaluating assumptions used in their capital investments analysis five to ten years in the past when interest rates were substantially lower. The other aspect involves including restrictions and regulations implemented in the past two years that have negatively influenced the business and energy space. Does anyone have any follow-up thoughts regarding business trends and how the economy and interest rates may influence capital budget assumptions…? (no quotes, 100 words)
