LiveRamp Holdings' (NYSE:RAMP) Strong Earnings Are Of Good Quality
LiveRamp Holdings' (NYSE:RAMP) Strong Earnings Are Of Good Quality
The subdued stock price reaction suggests that LiveRamp Holdings, Inc.'s (NYSE:RAMP) strong earnings didn't offer any surprises. We think that investors have missed some encouraging factors underlying the profit figures.
LiveRamp Holdings,Inc.(紐交所:RAMP)強勁的收益沒有引起股價的明顯反應,我們認爲,投資者已經忽略了盈利數據背後一些令人鼓舞的因素。
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A Closer Look At LiveRamp Holdings' Earnings
深入分析LiveRamp Holdings的收益
In high finance, the key ratio used to measure how well a company converts reported profits into free cash flow (FCF) is the accrual ratio (from cashflow). The accrual ratio subtracts the FCF from the profit for a given period, and divides the result by the average operating assets of the company over that time. The ratio shows us how much a company's profit exceeds its FCF.
在高金融領域,用來衡量一家公司如何將報告的利潤轉換爲自由現金流(FCF)的主要比率是應計比率(來自現金流)。應計比率從給定期間的自由現金流中減去利潤,並將結果除以該公司在該期間內的平均營運資產。該比率顯示了一家公司的利潤超過其自由現金流的程度。
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.
因此,一家公司有負應計比率實際上是一件好事,但是如果它的應計比率爲正,那是一件壞事。這並不意味着我們應該擔心應計比率爲正,但值得注意的是,如果應計比率相當高,有一些學術證據表明,這是一個不利於近期利潤的壞跡象。
LiveRamp Holdings has an accrual ratio of -0.18 for the year to March 2024. That implies it has very good cash conversion, and that its earnings in the last year actually significantly understate its free cash flow. In fact, it had free cash flow of US$103m in the last year, which was a lot more than its statutory profit of US$10.1m. LiveRamp Holdings shareholders are no doubt pleased that free cash flow improved over the last twelve months. However, that's not all there is to consider. We can see that unusual items have impacted its statutory profit, and therefore the accrual ratio.
LiveRamp Holdings到2024年3月的應計比率爲-0.18。這意味着它有非常好的現金轉換率,並且在過去一年的收益實際上嚴重低估了其自由現金流。事實上,它在過去一年中的自由現金流爲1.03億美元,比其法定利潤10.1億美元要多得多。LiveRamp Holdings的股東無疑會對過去十二個月中自由現金流的提高感到滿意。然而,這並不是合理考慮的所有因素。我們可以看到,異常項目影響了它的法定利潤,因此也影響了應計比率。
That might leave you wondering what analysts are forecasting in terms of future profitability. Luckily, you can click here to see an interactive graph depicting future profitability, based on their estimates.
這可能會讓您想知道分析師對未來盈利能力的預測。幸運的是,您可以單擊此處查看基於其估計的未來盈利能力的互動圖表。
How Do Unusual Items Influence Profit?
非常規項目如何影響利潤?
LiveRamp Holdings' profit was reduced by unusual items worth US$14m in the last twelve months, and this helped it produce high cash conversion, as reflected by its unusual items. In a scenario where those unusual items included non-cash charges, we'd expect to see a strong accrual ratio, which is exactly what has happened in this case. It's never great to see unusual items costing the company profits, but on the upside, things might improve sooner rather than later. 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. LiveRamp Holdings took a rather significant hit from unusual items in the year to March 2024. All else being equal, this would likely have the effect of making the statutory profit look worse than its underlying earnings power.
在過去十二個月中,LiveRamp Holdings的利潤受到價值1400萬美元的異常項目的影響,這有助於它產生高現金轉換率,如其異常項目所反映的那樣。在這種情況下,如果這些異常項目包括非現金費用,我們將會看到一個強勁的應計比率,而這正是在這種情況下發生的。看到異常項目成本導致公司利潤下降並不是令人高興的事情,但好在,情況可能很快會有所改善。當我們分析全球絕大多數上市公司時,我們發現重大的異常項目往往不會重複出現。終究,這正是會計術語的意義。LiveRamp Holdings在2024年3月經歷了相當大的異常項目衝擊。其他條件相等的情況下,這可能會使法定利潤看起來比其基本盈利能力更差。
Our Take On LiveRamp Holdings' Profit Performance
我們對LiveRamp Holdings的利潤表現的看法
In conclusion, both LiveRamp Holdings' accrual ratio and its unusual items suggest that its statutory earnings are probably reasonably conservative. Based on these factors, we think LiveRamp Holdings' underlying earnings potential is as good as, or probably even better, than the statutory profit makes it seem! If you'd like to know more about LiveRamp Holdings as a business, it's important to be aware of any risks it's facing. You'd be interested to know, that we found 1 warning sign for LiveRamp Holdings and you'll want to know about this.
綜上所述,LiveRamp Holdings的應計比率和異常項目表明其法定收益可能相當保守。基於這些因素,我們認爲LiveRamp Holdings的基本盈利潛力至少和法定利潤一樣好,甚至更好!如果您想了解LiveRamp Holdings的業務,重要的是要意識到它面臨的任何風險。您會感興趣的是,我們爲LiveRamp Holdings找到了1個警告信號,您會想知道這一點。
After our examination into the nature of LiveRamp Holdings' profit, we've come away optimistic for the company. But there are plenty of other ways to inform your opinion of a company. Some people consider a high return on equity to be a good sign of a quality business. So you may wish to see this free collection of companies boasting high return on equity, or this list of stocks with high insider ownership.
經過我們對LiveRamp Holdings利潤的檢查後,我們對該公司持樂觀態度。但是,了解公司的質量的人有很多其他方法。有些人認爲,高股本回報率是優質企業的一個很好的標誌。因此,您可能希望查看這些高股本回報率的公司的免費收藏,或者查看這些擁有高內部持有率的股票列表。
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