Working Capital

Current assets minus current liabilities — the cash buffer a company has to fund day-to-day operations.

Working Capital — Current assets minus current liabilities — the cash buffer a company has to fund day-to-day operations.

Key facts

Category
Financial Health
Definition
Current assets minus current liabilities — the cash buffer a company has to fund day-to-day operations.
Formula
Working Capital = Current Assets - Current Liabilities
Live example
/research/stock/COST
Last updated
2026-06-17

Formula

Working Capital = Current Assets - Current Liabilities

How IndexAlpha uses Working Capital

On the Financial Health card. Negative working capital isn't always bad — efficient retailers (Costco, Walmart) often run negative working capital because supplier credit funds inventory faster than it sells.

See it live

The Working Capital metric shows up on every IndexAlpha research page. See it now on COST — or research any stock to view its Working Capital.

Related terms

Common questions

What is Working Capital?

Current assets minus current liabilities — the cash buffer a company has to fund day-to-day operations.

How is Working Capital calculated?

Working Capital = Current Assets - Current Liabilities

How does IndexAlpha use Working Capital?

On the Financial Health card. Negative working capital isn't always bad — efficient retailers (Costco, Walmart) often run negative working capital because supplier credit funds inventory faster than it sells.

Sources