What are free cash flows?

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FCF(free cash flows) is an assessment of the amount of cash a company generates after accounting for all
capital expenditures, such as buildings or property, plant and equipment. The excess cash
is used to expand production, develop new products, make acquisitions, pay dividends
and reduce debt.
FCF – EBIT (1-tax rate) + (depreciation) + (amortization) – (change in net working capital) – (capital expenditure).