Cash flow patterns

- The normal pattern of positive inflows … or negative outflows of cash … reported in the cash flow statement is as follows. … Positive cash from operating activities. … Negative cash from investing activities. … And positive or negative cash from financing activities. … Now most companies, over 70% in the United States, … generate positive cash flow from operations. … In fact, suffering several periods … of negative cash from operations … is a short indicator of financial trouble. … In normal times, most companies use cash … to expand or enhance long-term assets. … So cash from investing activities is usually negative … about 85% of the time in the United States. … A company with positive cash from investing activities … is selling off its long-term assets … faster than it's replacing them. … Now predicting whether the sign of cash … from financing activities will be positive or negative … is more difficult. … The sign depends on where the company is, … young and growing or whether it's mature and stable …