Isidorean Rule

The Isidorean Rule is a method used in financial analysis to determine whether a company is generating enough cash flow to cover its capital expenditures, such as equipment and infrastructure upgrades. It involves comparing a company's operating cash flow (cash generated from core operations) to its capital expenditures; if the cash flow exceeds or equals these investments, the company is considered financially healthy and capable of funding growth from its operations. Essentially, it helps investors assess whether a company's cash flow is sufficient to maintain or expand its business without needing external financing.