Sundy Service Group Co. Ltd (HKG:9608) announced strong profits, but the stock was stagnant. Our analysis suggests that shareholders have noticed something concerning in the numbers.
Check out our latest analysis for Sundy Service Group
![earnings-and-revenue-history](https://usnewsfile.futunn.com/pic/0-15440691-0-a5dec89ea02f50684b92fa4596e24e15.png/big)
SEHK:9608 Earnings and Revenue History October 10th 2022
Examining Cashflow Against Sundy Service Group's Earnings
Many investors haven't heard of the accrual ratio from cashflow, but it is actually a useful measure of how well a company's profit is backed up by free cash flow (FCF) during a given period. 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. You could think of the accrual ratio from cashflow as the 'non-FCF profit ratio'.
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. While having an accrual ratio above zero is of little concern, we do think it's worth noting when a company has a relatively high accrual ratio. 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 June 2022, Sundy Service Group recorded an accrual ratio of 2.22. As a general rule, that bodes poorly for future profitability. To wit, the company did not generate one whit of free cashflow in that time. In the last twelve months it actually had negative free cash flow, with an outflow of CN¥156m despite its profit of CN¥50.4m, mentioned above. It's worth noting that Sundy Service Group generated positive FCF of CN¥16m a year ago, so at least they've done it in the past.
Note: we always recommend investors check balance sheet strength. Click here to be taken to our balance sheet analysis of Sundy Service Group.
Our Take On Sundy Service Group's Profit Performance
As we discussed above, we think Sundy Service Group's earnings were not supported by free cash flow, which might concern some investors. As a result, we think it may well be the case that Sundy Service Group's underlying earnings power is lower than its statutory profit. But at least holders can take some solace from the 28% per annum growth in EPS for the last three. 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. With this in mind, we wouldn't consider investing in a stock unless we had a thorough understanding of the risks. For instance, we've identified 2 warning signs for Sundy Service Group (1 can't be ignored) you should be familiar with.
This note has only looked at a single factor that sheds light on the nature of Sundy Service Group's profit. But there are plenty of other ways to inform your opinion of a company. 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.
森迪服务集团有限公司(HKG:9608)公布强劲盈利,但股价停滞不前。我们的分析表明,股东们注意到了数字中的一些令人担忧的地方。
查看我们对桑迪服务集团的最新分析
![earnings-and-revenue-history](https://usnewsfile.futunn.com/pic/0-15440691-0-a5dec89ea02f50684b92fa4596e24e15.png/big)
联交所:9608盈利及收入历史2022年10月10日
检查现金流与森迪服务集团的收益
许多投资者都没有听说过现金流应计比率但它实际上是衡量一家公司在给定时期内自由现金流(FCF)支持公司利润的程度的有用指标。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。你可以把来自现金流的应计比率看作是‘非FCF利润率’。
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。虽然应计比率高于零并不令人担忧,但我们确实认为,当一家公司的应计比率相对较高时,这一点值得注意。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6月的12个月内,森迪服务集团的应计比率为2.22。一般来说,这对未来的盈利能力来说是个不好的预兆。换句话说,该公司在那段时间没有产生一分钱的自由现金流。在过去的12个月里,它实际上有负面自由现金流,尽管其利润为5040万元,但仍流出1.56亿元。值得注意的是,桑迪服务集团一年前产生了1600万元的正FCF,所以至少他们过去做到了。
注:我们总是建议投资者检查资产负债表的实力。点击此处查看我们对森迪服务集团的资产负债表分析。
我们对森迪服务集团盈利表现的看法
正如我们上面讨论的,我们认为Sundy Service Group的收益没有得到自由现金流的支持,这可能会让一些投资者感到担忧。因此,我们认为很可能是桑迪服务集团的基础盈利能力低于其法定利润。但至少持有者可以从过去三年每股收益28%的年增长率中得到一些安慰。当然,当谈到分析其收益时,我们只是触及了皮毛;人们还可以考虑利润率、预测增长和投资回报等因素。考虑到这一点,除非我们对风险有透彻的了解,否则我们不会考虑投资股票。例如,我们已经确定桑迪服务集团的2个警示标志(1不可忽视)你应该熟悉的。
这份报告只关注了一个因素,它揭示了桑迪服务集团的利润性质。但还有很多其他方式可以让你了解一家公司的看法。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。