Would you prefer current earnings over current free cashSolu

Would you prefer current earnings over current free cash?

Solution

I would prefer current earnings when compared to the current cash flow. The reason is that current earnings gives the amount of money that the company has earned from its operations over the last quarter or financial year. The current cash flow refers to the cash earned by the company during the last quarter or financial year. The cash could be from any source, not necessarily from the operations of the company. Thus preferring current earnings is better from current cash flow.