$Cross Country Healthcare (CCRN.US)$Revenue has been growing...

Gross profit margin has continued to decline slowly over the past 5 years, indicating that it is not an industry with economies of scale; growth is limited by endogenous origin.

What is interesting is that although profits have increased dramatically in the past two years, interest expenses have increased at the same time, reaching 5% of operating profit in 2022, and the ratio is still very low.

2023Q1 revenue fell 21%, operating profit fell 47% to $50 million, and net profit fell 53% to $0.3 billion.

The balance sheet shows that accounts receivable increased by 324 million to 499 million in 2021, accounts receivable increased by 161 million to 660 million. The increase in accounts receivable in two years was higher than net profit in two years. The profit content was very low. Accounts receivable in 2022 accounted for 23.5% of operating income, and is still in a healthy range.

Currently, goodwill and other intangible assets are $205 million, accounting for 45% of net assets, and long-term loans of $138 million, accounting for 30.5% of net assets of 452 million. The leverage ratio is not too high within the sector.

Despite good book profits in the past two years, net operating cash flow was still lower than net investment, and no shareholders' surpluses were generated.

Currently, the price-earnings ratio is 5.3, and the price-earnings ratio has been raised to 6.4. If net profit falls by 50% for the whole year, the corresponding price-earnings ratio is 9.7, so you can choose carefully (⭐️)