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An wise investor would look for non-recurring revenues and expenses. This helps to determine if the current year is repeatable and not just an exception. Examples would include asset write-offs, court judgments, and tax exceptions.
The investor would also try to determine profit margin. Could the business survive a short downturn or would the business be dependent upon getting additional financing.

2007-10-28 11:02:41 · answer #1 · answered by Menehune 7 · 0 0

Cash flow statement provides information about the Cash position of the company that how much funds it has been able to generate from its operations

Investors are primary interested in seeing how much cash is available to make interest payments and how the company has utilized the Cash available .has it made enough investments in current assets or has tied its funds in fixed assets .

Positive cash flow indicates that company has sufficient funds to discharge its current liabilities .

You can refer to IAS 7 to have complete information about Cash flows .

2007-10-28 15:09:43 · answer #2 · answered by ayiesha 1 · 0 0

What she said above
plus,
the investor can use information from a cash flow statement to value the stock and determine whether it is undervalued, fair, or overvalued.

2007-10-28 17:48:55 · answer #3 · answered by Jiniya 2 · 0 0

i cant beat that

2007-10-28 16:49:20 · answer #4 · answered by Greg M 2 · 0 0

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