The profitability level of a listed company is the most important evaluation criterion for a listed company’s operating conditions, and it is also the place that investors value most when looking for a dark horse that doubles, and it is directly proportional to the interests of investors. The higher the profitability of listed companies, the higher the profitability of investors; the lower the profitability of listed companies, the lower the profitability of investors. Therefore, stock investors must pay great attention to the profitability of listed companies, and analyze and judge the timing of buying and selling stocks based on the profitability of listed companies, especially the changes in profits of listed companies.
The general principle of analyzing and judging the timing of buying and selling stocks based on the company’s profitability is: if a certain listed company has a high profit level and there is a trend of continued growth, investors should choose the listed company’s stock investment; When the profit level of listed companies is low and there is a possibility of further decline, investors should not blindly hold shares. But there must be a certain premise. If the decline in the company’s profitability is caused by some normal factors, such as the company’s plan to expand construction, or the decline in profitability is due to the impact of the macro environment, then this profit The decline in the level is a temporary phenomenon. At this time, investors can still hold shares cautiously. But if it is not caused by normal circumstances, investors should generally consider selling the stock. If a listed company suffers consecutive losses, small and medium-sized investors had better stay away from it. Because according to the company law, if you lose money for three consecutive years, you will be delisted. At this time, the interests of investors cannot be guaranteed.
The asset and liability status of a listed company is the main content of the company’s financial report and an important factor in analyzing the company’s operating conditions, especially the company’s current assets and current liabilities. The company’s current assets and current liabilities should maintain an appropriate proportional relationship, which will vary depending on the nature of the company and the different commodities it operates. Having too many liquid assets in a company is not entirely a good thing, but generally speaking, it is better to have more liquid assets than less. Because if a company’s net current assets (that is, working capital, which is the difference between current assets and current liabilities) decline year by year, it means that the company’s current assets have decreased, or its current liabilities have increased. In terms of current assets, it mainly depends on how much cash the company has, how much accounts receivable are there, and whether the inventory has increased excessively. Excessive build-up of inventories is also a red flag.
