How do you project capex?

Management will often make indications if they are going to be investing more heavily in capex than usual. This information and commentary can be found in earnings transcripts, annual reports, and the MD&A section of quarterly filings.

Based on management guidance, we can either put in the capex directly as a $ amount, or drive capex as a % of revenue if we aren’t given exact numbers from management.

We can also disaggregate between maintenance capex and growth capex. Maintenance capex is used to maintain the current assets while growth capex is used to buy new assets.