Working capital
Short-term liquidity cushion: what's left of current assets after covering current liabilities.
Working capital = Current assets − Current liabilities
The money trapped in the day-to-day of the business: what customers owe you plus inventory, minus what you owe suppliers. The larger it is, the more cash sits immobilized just to keep the company running.
Its CHANGE is what explains most of the gap between profit and cash. If it grows faster than sales, growth is being self-financed with cash that doesn't come back: customers taking longer to pay, or warehouses filling up. Some businesses run it negative — supermarkets, airlines, subscriptions — because they collect before they pay: there, growing generates cash instead of consuming it.
Where to see it on ValuatePad
Year by year, for every company, in the tab Market.