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Cash-flow return on investment is a valuation model that assumes the stock market sets prices based on cash flow, not on corporate performance and earnings. : For the corporation, it is essentially internal rate of return (IRR). CFROI is compared to a hurdle rate to determine if investment/product is performing adequately. The hurdle rate is the total cost of capital for the corporation calculated by a mix of cost of debt financing plus investors `expected return on equity investments. The CFROI must exceed the hurdle rate to satisfy both the debt financing and the investors expected return. : Michael J. Maubossin, in his 2006 book 'MORE THAN YOU KNOW', quoted an analysis by CSFB, that, measured by CFROI, performance of companies tend to converge after five years in terms of their survival rates. The CFROI for a firm or a division can then be written as follows: : where ''n'' is the expected life of the asset and ''K''''c'' is the replacement cost in current dollars. ==See also== *Return of capital * External discussion of (Flow Return on Investment ) at the (Business KPI ) Wiki 抄文引用元・出典: フリー百科事典『 ウィキペディア（Wikipedia）』 ■ウィキペディアで「Cash-flow return on investment」の詳細全文を読む スポンサード リンク
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