PAX

vs

KKR

Free Cash Flow (FCF) is the money a company has left over after it pays for all its expenses and any investments it needs to make to keep the company running smoothly.

Think of it like your personal budget at home: after you pay for your necessities, like rent and groceries, and set aside money for future needs, like saving for a car or home repairs, the cash you have left is what you're free to spend or save as you wish.

It's a sign of a company's health and its ability to do things like grow its business, pay dividends to shareholders, or reduce debt.

Flexibility: Companies with more FCF can make big moves without having to borrow money or ask for more investment, giving them the freedom to grow or tackle new projects on their terms.

Rewards for Investors: When a company has extra cash, it can decide to give some back to its investors through dividends or by buying back shares, which can increase the value of the remaining shares.

A Healthy Sign: Regularly having more cash coming in than going out shows that a company is doing well, making smart decisions, and earning more than it spends.

The Equity Waterfall is a visual breakdown of a company's capital structure showing how its total assets are funded and what portion belongs to shareholders.

It starts with the company's assets, adds them up step by step, then subtracts liabilities like debt and payables. What remains is the equity - the value owned by shareholders.

In simple terms:

This chart helps you quickly see:

• What the company owns (cash, property, intangibles).
• What it owes (debt, payables).
• How much of the company's value belongs to its shareholders.

By comparing Equity Waterfalls across companies, you can spot who relies more on debt, who holds more intangibles, and who has a stronger financial foundation.