If the cash outflow of the company's domestic investment increases substantially, it often means that the company faces new development opportunities or new investment opportunities, and the growth of the company's stock will generally be very good. If the cash outflow of the company's foreign investment increases significantly, it shows that the company's normal business activities have not fully absorbed its existing funds, but need to find profit opportunities through investment activities. When analyzing the cash flow generated by investment activities, investors should comprehensively analyze the cash flow generated by financing activities. If the cash flow generated by a company's operating activities has not changed, a large amount of net cash outflow generated by the company's investment activities is solved by a large amount of net cash inflow generated by financing activities, indicating that the company is expanding.
First, the form of enterprise's inward investment.
The form of inward investment refers to the concrete manifestation of various economic resources formed by putting the raised funds into the internal production and operation activities of enterprises. The main forms are:
floating assets
1. Monetary fund
Including cash, bank deposits and other monetary funds.
2. Short-term investment
All kinds of marketable securities and other investments that can be realized at any time and held for less than one year.
Including short-term stocks, short-term bonds and other short-term investments.
Enterprises can only be used for short-term investment if they have excess cash in the short term. Its purpose is:
① Reserve payment ability.
② Increase idle cash income.
3. Accounts receivable
Accounts receivable and irrecoverable accounts formed by enterprises providing commercial credit to customers through selling commodities, products or providing services are called accounts receivable, including bills receivable, accounts receivable and prepayments. Reasons for using receivables for investment:
(1) is beneficial for enterprises to expand sales and increase market share;
(2) It is beneficial for enterprises to reduce excessive inventory, so as to reduce capital occupation and save their storage costs;
(3) is conducive to the acquisition of futures, to ensure the smooth progress of enterprise production and business activities.
4. Inventory
Various assets stored by an enterprise for sale or consumption in its production and business activities.
Including commodities, finished products, semi-finished products, products in process and various materials, fuels, packaging materials, low-value consumables, etc.
In order to ensure normal production and sales activities and increase profits, enterprises need to arrange a certain amount of inventory when making internal investments.
Disadvantages: ① Increasing inventory reserves will increase the occupation of working capital,
(2) It will increase the loss of inventory and its storage cost,
(3) When the market price of inventory drops, it will also bring price reduction losses.
Second, the fixed assets
From the perspective of investment purposes, fixed assets include fixed assets for production and operation and fixed assets for living welfare.
1. Fixed assets for production and operation
Fixed assets that play a role in the production and operation activities of enterprises are called fixed assets for production and operation.
It is the main material and technical basis for enterprises to engage in production and business activities.
(2) It is an important guarantee for enterprises to gain profits, and enterprises often give priority to domestic investment.
2. Living welfare fixed assets
Enterprises will gradually get rid of the social burden, and the investment in fixed assets for life and welfare will be reduced.