A lackluster earnings announcement from Yechiu Metal Recycling (China) Ltd. (SHSE:601388) last week didn't sink the stock price. However, we believe that investors should be aware of some underlying factors which may be of concern.
View our latest analysis for Yechiu Metal Recycling (China)
The Impact Of Unusual Items On Profit
Importantly, our data indicates that Yechiu Metal Recycling (China)'s profit received a boost of CN¥24m in unusual items, over the last year. While we like to see profit increases, we tend to be a little more cautious when unusual items have made a big contribution. When we crunched the numbers on thousands of publicly listed companies, we found that a boost from unusual items in a given year is often not repeated the next year. And, after all, that's exactly what the accounting terminology implies. If Yechiu Metal Recycling (China) doesn't see that contribution repeat, then all else being equal we'd expect its profit to drop over the current year.
Note: we always recommend investors check balance sheet strength. Click here to be taken to our balance sheet analysis of Yechiu Metal Recycling (China).
Our Take On Yechiu Metal Recycling (China)'s Profit Performance
We'd posit that Yechiu Metal Recycling (China)'s statutory earnings aren't a clean read on ongoing productivity, due to the large unusual item. Therefore, it seems possible to us that Yechiu Metal Recycling (China)'s true underlying earnings power is actually less than its statutory profit. Sadly, its EPS was down over the last twelve months. Of course, we've only just scratched the surface when it comes to analysing its earnings; one could also consider margins, forecast growth, and return on investment, among other factors. If you'd like to know more about Yechiu Metal Recycling (China) as a business, it's important to be aware of any risks it's facing. In terms of investment risks, we've identified 2 warning signs with Yechiu Metal Recycling (China), and understanding these should be part of your investment process.
Today we've zoomed in on a single data point to better understand the nature of Yechiu Metal Recycling (China)'s profit. But there is always more to discover if you are capable of focussing your mind on minutiae. For example, many people consider a high return on equity as an indication of favorable business economics, while others like to 'follow the money' and search out stocks that insiders are buying. So you may wish to see this free collection of companies boasting high return on equity, or this list of stocks that insiders are buying.
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重要的是,我们的数据表明,去年Yechiu Metal Recycling(中国)的稀有物品利润增加了2400万元人民币。虽然我们希望看到利润增加,但当不寻常的物品做出重大贡献时,我们往往会更加谨慎一些。当我们计算数千家上市公司的数字时,我们发现,特定年份中不寻常的项目所带来的提振通常不会在第二年重演。而且,毕竟,这正是会计术语的含义。如果Yechiu Metal Recycling(中国)认为这种贡献不会重演,那么在其他条件相同的情况下,我们预计其利润将在本年度下降。
注意:我们始终建议投资者检查资产负债表的实力。点击此处查看我们对Yechiu Metal Recycling(中国)的资产负债表分析。
我们对怡秋金属回收(中国)盈利表现的看法
我们认为,Yechiu Metal Recycling(中国)的法定收益并不能完全反映持续的生产率,这是因为这个很大的不寻常项目。因此,在我们看来,Yechiu Metal Recycling(中国)的真正潜在盈利能力实际上可能低于其法定利润。不幸的是,在过去的十二个月中,其每股收益有所下降。当然,我们只是在分析其收益时才浮出水面;人们还可以考虑利润率、预测增长和投资回报率等因素。如果您想进一步了解Yechiu金属回收(中国)作为一家企业,请务必了解其面临的任何风险。在投资风险方面,我们已经与Yechiu Metal Recycling(中国)确定了两个警告信号,了解这些信号应该是您投资过程的一部分。