Debt:
Before selecting or investing in any marketable security or stock, you must want to see the debt level of the company. I usually look for companies where free cash flow provided by companies pay off the entire debt within 3 to 4 years. For example, as of writing this book, the iPhone maker Apple has a total debt of $121.84 billion and free cash flow of about $44 billion. Thus, it can easily pay off the entire debt within ($121.84/$44) 2.76 years.
Take another example of the conglomerate giant General Electric (Symbol GE). GE has total debt of $126 billion vs free cash flow of $21 billion. This equates to the number of years to repay the current debt ($126 billion/$21 billion) at 6 years.
