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2011년 6월 2일 목요일

financial highlights for two companies

IF you take a look at this financial highlights,
It is very easy to notice that the company's financials are not in a very healthy condition.

First of all, ROE is -264.40%. This already seems very severe. Moreover, EBITDA is also -12.40M with operating cash flow -8.15M.

People might think : why would a person buy a stock of this kind of disastrous firm?

Well, but that is not always the case. Firms get better and no-one can guarantee it. That is why these kind of stocks are very cheap in their price.

Currently, it is traded for 0.18 per share - I purchased these stocks only by using 40 dollars, so it can not be too bad.

Well for me, I purchased this stock due to some reasons.

I believe that quarterly growth shows potentials. If earnings started to grow, then it is very likely to have continuous growth.

Plus, this company is an organic company - which is environmentally friendly. Since the trend is more eco-friendly based product, I thought it cannot be too bad for sure.

Good thing is that Idaho state and Washington state started to use the companies products in testing their land. I think this is probably due to the organic, eco-friendly based product they produce.

Anyways, the thing I want to point out is - technical analysis is something I doubt it now. I feel like past price pattern does not really tell you anything. According to the SMA of 100 days the bearish movement is supposed to be present for this firm, but it was not.
It is more important to focus on the financials, and the current trend in the market and see the potential growth of a company.

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