We Think Huadian Energy's (SHSE:600726) Solid Earnings Are Understated
We Think Huadian Energy's (SHSE:600726) Solid Earnings Are Understated
Huadian Energy Company Limited (SHSE:600726) announced a healthy earnings result recently, and the market rewarded it with a strong uplift in the stock price. Looking deeper at the numbers, we found several encouraging factors beyond the headline profit numbers.
华电能源有限公司(SHSE: 600726)最近公布了健康的收益业绩,市场对其进行了强劲的股价上涨。深入研究这些数字,除了总体利润数字外,我们还发现了几个令人鼓舞的因素。
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Zooming In On Huadian Energy's Earnings
放大华电能源的收益
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. In plain english, this ratio subtracts FCF from net profit, and divides that number by the company's average operating assets over that period. You could think of the accrual ratio from cashflow as the 'non-FCF profit ratio'.
许多投资者还没有听说过现金流的应计比率,但它实际上是衡量公司在给定时期内自由现金流(FCF)在多大程度上支持利润的有用指标。简而言之,该比率从净利润中减去FCF,然后将该数字除以该时期公司的平均运营资产。你可以将现金流的应计比率视为 “非FCF利润率”。
As a result, a negative accrual ratio is a positive for the company, and a positive accrual ratio is a negative. 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. That's because some academic studies have suggested that high accruals ratios tend to lead to lower profit or less profit growth.
因此,负应计比率对公司来说是正数,而正应计比率是负数。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,应计比率相当高的地方。这是因为一些学术研究表明,高应计率往往会导致利润下降或利润增长减弱。
Huadian Energy has an accrual ratio of -0.11 for the year to March 2024. That indicates that its free cash flow was a fair bit more than its statutory profit. Indeed, in the last twelve months it reported free cash flow of CN¥2.1b, well over the CN¥169.1m it reported in profit. Huadian Energy did see its free cash flow drop year on year, which is less than ideal, like a Simpson's episode without Groundskeeper Willie.
截至2024年3月的一年中,华电能源的应计比率为-0.11。这表明其自由现金流远超过其法定利润。事实上,在过去的十二个月中,它报告的自由现金流为21亿元人民币,远远超过其报告的利润1.691亿元人民币。华电能源的自由现金流确实同比下降,这并不理想,就像辛普森没有场地管理员威利的剧集一样。
Note: we always recommend investors check balance sheet strength. Click here to be taken to our balance sheet analysis of Huadian Energy.
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华电能源的资产负债表分析。
Our Take On Huadian Energy's Profit Performance
我们对华电能源盈利表现的看法
As we discussed above, Huadian Energy has perfectly satisfactory free cash flow relative to profit. Based on this observation, we consider it likely that Huadian Energy's statutory profit actually understates its earnings potential! And one can definitely find a positive in the fact that it made a profit this year, despite losing money last year. The goal of this article has been to assess how well we can rely on the statutory earnings to reflect the company's potential, but there is plenty more to consider. In light of this, if you'd like to do more analysis on the company, it's vital to be informed of the risks involved. While conducting our analysis, we found that Huadian Energy has 1 warning sign and it would be unwise to ignore this.
正如我们上面讨论的,相对于利润,华电能源的自由现金流非常令人满意。基于这一观察,我们认为华电能源的法定利润实际上可能低估了其盈利潜力!尽管去年亏损,但它今年还是实现了盈利,这一事实肯定可以找到积极的一面。本文的目标是评估我们在多大程度上可以依靠法定收益来反映公司的潜力,但还有很多需要考虑的地方。有鉴于此,如果你想对公司进行更多分析,了解所涉及的风险至关重要。在进行分析时,我们发现华电能源有1个警告信号,忽视这一点是不明智的。
This note has only looked at a single factor that sheds light on the nature of Huadian Energy'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.
本报告仅研究了揭示华电能源利润性质的单一因素。但是,还有很多其他方法可以让你对公司的看法。例如,许多人认为高股本回报率是有利的商业经济的标志,而另一些人则喜欢 “关注资金”,寻找内部人士正在买入的股票。虽然可能需要你进行一些研究,但你可能会发现这份免费收集的拥有高股本回报率的公司,或者这份内部人士正在购买的股票清单很有用。
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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.
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Simply Wall St的这篇文章本质上是笼统的。我们仅使用公正的方法根据历史数据和分析师的预测提供评论,我们的文章无意作为财务建议。它不构成买入或卖出任何股票的建议,也没有考虑到您的目标或财务状况。我们的目标是为您提供由基本数据驱动的长期重点分析。请注意,我们的分析可能不考虑最新的价格敏感型公司公告或定性材料。简而言之,华尔街没有持有任何上述股票的头寸。