Expressed as a percentage, it can be compared directly with bond yields and with the cost-of-equity. A business trading on a 7% free cash flow yield that grows 3% a year offers an implied return near 10% if the multiple holds.
Keep the levels consistent: equity free cash flow against market cap, or unlevered-free-cash-flow against enterprise value. Mixing them produces a yield that is simply wrong rather than merely debatable.
Example: Northwind Tools generates $89M of free cash flow on a $2.5B market cap, a 3.6% yield. On the enterprise measure, $70M of unlevered free cash flow over $2.86B is 2.4%.
Related: free-cash-flow, price-to-free-cash-flow, cost-of-equity, unlevered-free-cash-flow, earnings-yield