The market for A.Plus Group Holdings Limited's (HKG:1841) shares didn't move much after it posted weak earnings recently. We think that the softer headline numbers might be getting counterbalanced by some positive underlying factors.
View our latest analysis for A.Plus Group Holdings
SEHK:1841 Earnings and Revenue History December 5th 2022
A Closer Look At A.Plus Group Holdings' Earnings
As finance nerds would already know, the accrual ratio from cashflow is a key measure for assessing how well a company's free cash flow (FCF) matches its profit. To get the accrual ratio we first subtract FCF from profit for a period, and then divide that number by the average operating assets for the period. The ratio shows us how much a company's profit exceeds its FCF.
Therefore, it's actually considered a good thing when a company has a negative accrual ratio, but a bad thing if its accrual ratio is positive. That is not intended to imply we should worry about a positive accrual ratio, but it's worth noting where the accrual ratio is rather high. Notably, there is some academic evidence that suggests that a high accrual ratio is a bad sign for near-term profits, generally speaking.
Over the twelve months to September 2022, A.Plus Group Holdings recorded an accrual ratio of -0.24. That indicates that its free cash flow quite significantly exceeded its statutory profit. To wit, it produced free cash flow of HK$19m during the period, dwarfing its reported profit of HK$13.0m. A.Plus Group Holdings shareholders are no doubt pleased that free cash flow improved over the last twelve months. Having said that, there is more to the story. We can see that unusual items have impacted its statutory profit, and therefore the accrual ratio.
Note: we always recommend investors check balance sheet strength. Click here to be taken to our balance sheet analysis of A.Plus Group Holdings.
How Do Unusual Items Influence Profit?
While the accrual ratio might bode well, we also note that A.Plus Group Holdings' profit was boosted by unusual items worth HK$2.1m in the last twelve months. While it's always nice to have higher profit, a large contribution from unusual items sometimes dampens our enthusiasm. When we analysed the vast majority of listed companies worldwide, we found that significant unusual items are often not repeated. And, after all, that's exactly what the accounting terminology implies. If A.Plus Group Holdings doesn't see that contribution repeat, then all else being equal we'd expect its profit to drop over the current year.
Our Take On A.Plus Group Holdings' Profit Performance
In conclusion, A.Plus Group Holdings' accrual ratio suggests its statutory earnings are of good quality, but on the other hand the profits were boosted by unusual items. Based on these factors, we think that A.Plus Group Holdings' profits are a reasonably conservative guide to its underlying profitability. So if you'd like to dive deeper into this stock, it's crucial to consider any risks it's facing. For example, A.Plus Group Holdings has 4 warning signs (and 2 which are a bit unpleasant) we think you should know about.
In this article we've looked at a number of factors that can impair the utility of profit numbers, as a guide to a business. 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. While it might take a little research on your behalf, you may find this free collection of companies boasting high return on equity, or this list of stocks that insiders are buying to be useful.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
中国的市场A.Plus Group Holdings Limited的(HKG:1841)在最近公布了疲弱的收益后,股价没有太大变动。我们认为,疲软的整体数据可能正在被一些积极的潜在因素所抵消。
查看我们对A.Plus Group Holdings的最新分析
联交所:1841盈利及收入历史2022年12月5日
近距离观察A.Plus Group Holdings的收益
正如金融书呆子们已经知道的那样,现金流应计比率是评估一家公司的自由现金流(FCF)与利润匹配程度的关键指标。为了得到应计比率,我们首先从一个时期的利润中减去FCF,然后用这个数字除以该时期的平均运营资产。这个比率向我们展示了一家公司的利润超过了它的FCF的多少。
因此,当一家公司的应计比率为负时,它实际上被认为是一件好事,但如果它的应计比率为正,那就是一件坏事。这并不意味着我们应该担心应计比率为正,但值得注意的是,在应计比率相当高的地方。值得注意的是,有一些学术证据表明,一般来说,高应计比率对短期利润来说不是一个好兆头。
在截至2022年9月的12个月中,A.Plus Group Holdings的应计比率为-0.24。这表明它的自由现金流大大超过了它的法定利润。换言之,该公司在此期间产生了1900万港元的自由现金流,令其报告的1300万港元利润相形见绌。A.Plus Group Holdings的股东无疑对过去12个月自由现金流的改善感到高兴。话虽如此,故事中还有更多的东西。我们可以看到,不寻常的项目影响了其法定利润,从而影响了应计比率。
注:我们总是建议投资者检查资产负债表的实力。单击此处查看我们对A.Plus Group Holdings的资产负债表分析。
不寻常的项目如何影响利润?
虽然应计比率可能是个好兆头,但我们也注意到,A Plus Group Holdings的利润在过去12个月受到价值210万港元的不寻常项目的提振。虽然有更高的利润总是好事,但不寻常的东西带来的巨大贡献有时会挫伤我们的热情。当我们分析全球绝大多数上市公司时,我们发现重大的不寻常项目往往不会重复。毕竟,这正是会计术语所暗示的。如果A.Plus Group Holdings没有看到这种贡献再次出现,那么在其他条件相同的情况下,我们预计该公司今年的利润将会下降。
我们对A.Plus集团控股公司利润表现的看法
总而言之,A.Plus Group Holdings的应计比率表明其法定收益质量良好,但另一方面,利润受到不寻常项目的提振。基于这些因素,我们认为A.Plus Group Holdings的利润是其潜在盈利能力的一个相当保守的指南。因此,如果你想更深入地研究这只股票,考虑它面临的任何风险是至关重要的。例如,A.Plus Group Holdings拥有4个警示标志(和2个令人不快的地方)我们认为你应该知道。
在这篇文章中,我们研究了一些因素,这些因素可能会削弱利润数字作为企业指南的效用。但如果你有能力将注意力集中在细枝末节上,总会有更多的东西需要发现。例如,许多人认为高股本回报率是有利的商业经济指标,而另一些人则喜欢“跟着钱走”,寻找内部人士正在买入的股票。虽然这可能需要为您做一些研究,但您可能会发现免费拥有高股本回报率的公司的集合,或者是内部人士购买的有用的股票清单。
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本文由Simply Wall St.撰写,具有概括性。我们仅使用不偏不倚的方法提供基于历史数据和分析师预测的评论,我们的文章并不打算作为财务建议。它不构成买卖任何股票的建议,也没有考虑你的目标或你的财务状况。我们的目标是为您带来由基本面数据驱动的长期重点分析。请注意,我们的分析可能不会将最新的对价格敏感的公司公告或定性材料考虑在内。Simply Wall St.对上述任何一只股票都没有持仓。