Internal Capital Generation Rate - ICGR

Companies exist to generate profits, or at least value, for shareholders. Some of that profit generation is earmarked for capital expenditures, and investors usually track it carefully.

Capital is just a fancy word for cash, more or less. And companies then deploy that capital for better returns in the future.

One example is cable, when it upgraded from handling only 20 channels to handling 500 and being all cable modem-y. The upgrade from 20 to 500 was funded in part by outside borrowing, but also by the internal generation of cash from cable systems, which then went to fund the upgrades.

Capital Generation: good. The Me Generation: not so good.