A company's net working capital is the amount of money it has available to spend on its day-to-day business operations, such as paying short term bills and buying inventory. Net working capital ...

Net working capital measures the short-term liquidity of a company. CAPEX, on the other hand, is a long-term investment in the future of a company.

Interpreting Net Working Capital Net working capital is positive if current assets exceed current liabilities. This means a company has sufficient money to pay its short-term financial obligations.

Net working capital (“NWC”) is often a highly scrutinized component in M&A deals and can significantly impact the purchase price. NWC represents the liquidity a company needs to run its day-to-day ...

Discover why it is important to include changes to net working capital as a component in calculating the net present value (NPV) of a company.