What is the primary focus of sustainable free cash flow?

Sustainable free cash flow is primarily concerned with the cash that remains after accounting for capital expenditures (CapEx). This metric provides insight into a company's ability to generate cash from its operations while also considering the reinvestment needed to maintain or grow its asset base. By focusing on the cash left over after these necessary expenditures, sustainable free cash flow reflects the true liquidity of a company, determining how much cash is available for distribution to investors, paying down debt, or reinvesting back into the business. Therefore, this form of cash flow is vital for evaluating the firm’s overall financial health and its capacity to continue its operations without requiring additional financing.

In contrast, the other options focus on different aspects of cash flow or profit generation. Revenue from investments pertains more to income generated outside the core operations, while funds available for dividend payouts do not encompass the reinvestment needs that sustainable free cash flow considers. Additionally, cash flow strictly from operating activities does not account for capital expenditures that are essential for sustainability and growth in the long run.