$Owens-Corning (OC.US)$🎯 As of July 26, 2027, the current p...

New data: 2022Q3 and annual report, Q1 2023

In 2022, the revenue increased by 14.9%, while the operating profit only grew by 10.2% due to the sharp increase in expenses. The net profit, on the other hand, saw a significant increase of 24.7% due to the impact of a 0.13 billion equity income. The interest expense in 2022 accounted for 6.9% of the operating profit, which is not a heavy burden.

In Q1 2023, the revenue slightly shrank by 0.6%, and the operating profit significantly declined by 21.6% due to the decline in gross margin and continued sharp increase in expenses. The net profit, however, increased by 24.4% to 0.38 billion due to the 0.19 billion gain from the sale of fixed assets.

There was not much change in accounts receivable in 2022, while inventory increased by 0.26 billion to reach 1.33 billion, indicating sales encountered resistance.

Goodwill and other intangible assets amounted to 3 billion, accounting for 62% of the 4.837 billion net assets. The treasury stock stood at 2.816 billion, representing a significant hidden asset. Long-term borrowings amounted to 3 billion, indicating that the actual leverage ratio is not low.

Except for 2018, the net operating cash flow has been significantly higher than the net investment cash flow over the past 5 years, resulting in a substantial amount of shareholder surplus.

The current PE ratio is 10.8, and the TTM PE ratio has decreased slightly to 9.7. If calculated based on the 5-year average net income of 0.56 billion, the PE ratio is 22. Looking at growth stocks, there is a certain discount; however, in the case of cyclical stocks, the valuation is too high. Overall, it is more prudent to reduce positions.