What can a company analyze using a cash flow statement?

The cash flow statement provides critical insights into the movements of cash within a company, focusing specifically on how cash is generated and utilized over a specific period. This statement breaks down cash flows into three main categories: operating activities, investing activities, and financing activities.

By examining these categories, a company can assess its ability to generate cash from operations, understand how it invests cash in growth opportunities or assets, and analyze how it finances its activities through borrowing or equity. This comprehensive look at cash generation and utilization is essential for evaluating the company's liquidity, financial health, and operational efficiency, making it the most relevant aspect to analyze from a cash flow statement.

Other options like analyzing gross profit margins, future capital expenditures, or employee compensation trends focus on different financial metrics and are not directly available through the cash flow statement. These elements may be better assessed through the income statement or balance sheet rather than through cash flow analysis.