Financial statement analysis criteria

Financial statements AnalysisIt can be said that some financial figures published by listed companies are carried out. AnalysisTo get some results. AnalysisOr vertical Ratio AnalysisAnd draw a conclusion. It should be said that after analyzing these boring figures, we can find out whether a company operates normally and whether the development prospects are good and whether it is worthwhile Investment. Financial statements AnalysisThe data source is mainly three reports: the balance sheet, the profit and loss statement, and the cash flow statement. The balance sheet reflects the balance between the company's assets and liabilities. The relationship between them can be expressed by "assets = Liabilities + shareholder equity. The profit and loss statement is a reflection of the business results within a certain period of time and a financial report on the income and loss. The cash flow statement reflects the company's inbound and outbound cash and cash equivalents within a certain period of time, so that people can understand and evaluate the company's ability to obtain cash equivalents. In this way, enterprises can predict their future cash flows. Through the balance sheet, you can understand the company's financial status, determine whether the company's solvency, capital structure is reasonable, and whether the liquidity is sufficient. The income statement can be used to understand AnalysisThe company's profitability, profitability, and operating efficiency determine the company's competitive position and Sustainable Development Ability in the industry.

Financial statementsAnalysisThere are three main methods: financial ratio during a single accounting periodAnalysis, Comparison between different accounting periodsAnalysisComparison with other companies in the same industryAnalysis. Financial StructureAnalysis, Operating efficiencyAnalysis, ProfitabilityAnalysisAndInvestmentBenefitsAnalysisAnd Cash Flow RateAnalysisThey also have their own evaluation indicators. Various indicators and computation types are listed below:

(1) SolvencyAnalysis: ① Current ratio = Current assets/current liabilities; ② fast moving ratio = fast moving assets/current liabilities = (current assets-inventory)/current liabilities; ③ interest payment multiples = profit before tax interest/(interest-expense); ④ receivables turnover rate = Sales Revenue/average receivables, receivables turnover days = 360/receivables turnover rate.

(2) Capital StructureAnalysis: ① Shareholder equity ratio = total shareholder equity/total assets × 100%; ② asset-liability ratio = total liabilities/total assets × 100%; ③ Ratio of long-term liabilities = total long-term liabilities/assets × 100%; ④ ratio of shareholder equity to fixed assets = total shareholder equity/total fixed assets × 100%.

(3) Operational EfficiencyAnalysis: ① Inventory turnover rate = sales cost/average inventory, inventory turnover days = 360/inventory turnover rate; ② fixed asset turnover rate = Sales Revenue/Average fixed assets; ③ total asset turnover rate = total sales revenue/Average assets; ④ shareholder equity turnover rate = Sales Revenue/average shareholder equity; ⑤ main business income growth rate = (current main business income-main business income in the previous period)/main business income in the previous period.

(4) ProfitabilityAnalysis: ① Gross profit margin = (sales revenue-sales cost)/sales revenue; ② sales net interest rate = net profit/sales revenue; ③ asset return rate = net profit/total average assets; ④ ownership benefit rate = net profit/average shareholder equity; ⑤ main business profit rate = main business profit/main business income.

(5)InvestmentBenefitsAnalysis: ① Net income per share = net profit/total number of shares issued outside; ② dividend distribution rate = dividend per share/net income per share; ③ interest rate of common shares = dividend per share/market price per share; ④ current profit ratio = share price/dividend per share; ⑤ price-earnings ratio = market price per share/net profit per share; ⑥InvestmentRate of Return =InvestmentEarnings/(beginning time, short termInvestment); 7. Net assets per share = net assets/number of ordinary shares issued outside the company; ⑧ net assets rate = market price per share/net value per share.

(6) Cash Flow RateAnalysis: ① Cash flow and liability ratio = cash/current liabilities; ② cash expiration and debt ratio = net cash flow of business activities/amount of debt due; ③ Ratio of total cash liabilities = net cash flow of business activities/total liabilities; ④ cash flow of each stock = (net cash generated by business activities-prestock interest)/number of common shares issued outside, capital cash flow = net cash generated for business activities/total capital; ⑤ ratio of cash flow to cash dividend = net cash flow of business activities/total cash dividend.

The above is the Financial RatioAnalysisSome calculation methods are often used, and each evaluation indicator has its own judgment criteria. By determining these indicators, we can determine the company's development prospects and whether it is worthwhile.InvestmentAmong them, several ratios must be very important, such as earnings per share and returns on net assets.

Criterion 1

Financial ReportAnalysisTo collect as much data as possible. That is to say, we are making a financial report.AnalysisThe data depends not only on the balance sheet, income statement, and cash flow statement provided by the listed company, in addition, you can also find and collect data from the "Prospectus", "Annual Report", and "Interim Report" published at the time of listing a listed company, as well as the company data published by the competent authority, you can also directly go to the City company to query. Only by fully understanding the relevant data of listed companies can we increase the authenticity and accuracy of the data, especially the accuracy directly affectsAnalysis.

Criterion 2

FinanceAnalysisIn the face of the balance sheet and income statement, you can use a simplified standard model to test the Ideality of the report. The following is an ideal standard form:

Ideal asset negative feedback table

60% of current assets and 40% of liabilities
Fast moving assets: 30% current liabilities: 30%
Inventory assets 30% long-term liabilities 10%
Fixed assets: 40% owner equity: 60%
Long-termInvestmentPaid-in capital: 20%
Provident Fund 30%
Unallocated profit: 10%
Total 100% total 100%

Requirements: ① the owner's equity shall be greater than the liability and the liability shall be less than the capital.
② About 2/3 of fixed assets are smaller than current assets.
③ Speed ratio: 1: 1, flow ratio: 2: 1.

Ideal profit and loss statement

Sales revenue: 100%
Sales cost (including tax) 25%
Gross profit: 25%
Period Fee: 13%
Business interest rate: 12%
Non-Business Profit and Loss: 1%
11% pre-tax profit
Income Tax 6%
5% after-tax profit

The above ideal report is only a general standard, and not all enterprises apply it, but it can help us get more concise results.

Criterion 3

Financial ReportAnalysisThere are several important indicators worth noting: ① fast-moving ratio; ② debt ratio; ③ main business growth rate; ④ net assets equity rate; ⑤ net income per share; ⑥ price-earnings ratio; 7. Cash flow per share; ⑧ dividend distribution rate. Especially for earnings per share and its annual growth rate and dividend distribution growth rateAnalysisIt can estimate the future development of the stock price and determine the approximate range of the stock price. However, it must be noted that China's listed companies have a short history and unstable performance, and there are very few companies issuing dividends. In addition, the market has not yet formed real value.InvestmentTherefore, it has little effect. However, some market leaders have begun to shift slowly to this aspect. If a company sees its growth potential and is committed to long-term growth, it is a direction and understands this method, in the futureInvestmentIs advantageous.
Criterion 4

Financial ReportAnalysisPay special attention to the following aspects: accounts receivable, inventory, long-termInvestmentShort-termInvestmentAccounting methods such as depreciation, amortization, interest income, one-time subsidies, tax incentives, asset sales and related transactions, because listed companies often adjust these aspects to adjust profits. These adjustments often bring amazing results in changing profits. Some people say that the profit of a listed company is not created by the company to produce goods or provide services, but by the accountant. This sentence makes sense in some aspects, if such problems are found to be unconventional, the profits should be adjusted to be more realistic and objective.

Criterion 5

In the financial reportAnalysisPay close attention to the "Comments" proposed by some accounting firms, which often imply the special information of some listed companies. If there are no special problems with the accounting materials published by a company, the general accounting firm will give a positive evaluation of the price, and will make some "reminders", because the listed company is the parent of the accounting firm, the "reminders" of accounting firms often indicate that the problem is already quite serious.

Criterion 6

FinanceAnalysisYou must be clear about its shortcomings. The data may be inaccurate, which may affect the judgment. Even if the data is accurate, however, since the data is recorded in the past, it can only be an appropriate evaluation of the past situation, the past does not mean that there will be much to be done in the future, but there are still many unpredictable things in the future. Therefore, we use financial statementsAnalysisThe result can only be a possible result or a prediction of the future. Therefore, although our computing results are accurate, we cannot make a definite judgment on the company's development.