#profit_quality
#quality_of_profit_fabahner
A very key concept in the fundamental analysis of companies is the topic of profit quality, familiarity with the topic of profit quality, although it is the alphabet of fundamental analysis and at the same time its most important pillar, but in the financial markets, the least people pay attention to it.
One of the companies that prioritizes the issue of profit quality in all reports and clarifications is Shahid Bahonar Copper Company.
The concept of the time series related to the quality of profit includes the following, which is examined separately in the case of the mentioned company:
1- Stability:
The higher the profit stability, the more the company has the ability to maintain current profits.
(By examining the financial procedures of Shahid Bahonar Copper Co., Ltd. in the past years, it is clear that the company uses the most conservative standards available to predict the future profitability trend in order to prevent negative adjustments; therefore, changes are applied in accordance with the definite occurrence of changes in the quality of profits. does.)
2- Predictability:
The ability to predict profit components, which is referred to as the ability to use past profit in predicting future profit.
(In the topic of profit components, many components of annual profit are not available for analysis at the current stage due to the implementation of development plans of previous years in this year and the conclusion of new contracts and the occurrence of effective fundamental changes due to the current correct and efficient management of the company.)
3- Liquidity:
Profit is calculated and identified based on accruals, the quality of profit directly depends on the cash flow and the amount of estimation and estimates in it, in the sense that the lower the estimate or the higher the liquidity, the subjective profit is The minimum and quality of profit is maximized.
(The mentioned company always uses the most conservative initial estimates in the initial forecast due to the reduction of risk and the increase of profit quality and uses the policy of applying the minimum estimate in exchange for the maximum change in the estimates.)
4- Reproducibility:
Continuity and repeatability lead to future profit, this structure means profit with support and supportability.
(Apart from the capacity resulting from the sale of slag waste and zinc oxide, which adds significant profit once a month for about two years to the heading of other operational incomes, all the items effective in making profits of the factories under this company’s collection repeatedly Shundeh is moving forward; it is more interesting that the very important item of slag soil has not been included in the annual budget forecast so far, which itself is a confirmation of the liquidity of the profit!)
General conclusion:
Shahid Bahonar Copper Industries Company is one of the leading companies in the capital market in terms of the key issue of profit quality, the expectations of high-quality serial adjustments of the company’s profit in the current year are not far from expectations, and the very high replacement value of this company, combined with the ability to make profits, is worthy of attention. The shares of this company will be among the symbols of low risk and favored by the capital market this year.
Alireza Mehrabadi
This post is written by Bamiii60