1, analysis of income statement
Mainly to compare and analyze whether the growth degree of the company's income this year is reasonable compared with last year. Under normal circumstances, the company's revenue and profits are growing steadily, and it is normal to increase by several or several percentage points a year. However, if it increases by more than 50% at once, or even exceeds 100%, it is definitely problematic. Of course, if you have the conditions, you can try to increase the length of the comparison, and look at the growth rate of net profit in recent years, you can see the profitability of this company.
2. Analysis of bad debts of enterprises
If a company has a lot of bad debts, that is, the products have been sold, but the money has not been recovered in the end, it becomes bad debts. Some companies will not mention or mention bad debts on their books, which will increase their income and profits, but this income and profits are obviously injected with water, which we should pay attention to.
3. Analyze other investment behaviors.
Many listed companies will make some other investments besides their main business. What we need to focus on is whether these investments are related to the company's main business. Good companies develop other projects or industries around their main business, which can promote each other. If other investment behaviors have nothing to do with their main business, or even no main business, then such companies had better not touch it.
4. Analysis of other receivables
See if there are many old accounts on the company's balance sheet. If the accounts receivable are confused and this happens, it means that many accounts can't be collected.
5. Analysis of related party transactions
What we need to pay attention to is whether the major shareholder borrows money from the company at the beginning or the middle of the year, and then repays it by bank loan at the end of the year, so that the borrowing behavior of the major shareholder can be covered up in the annual report.
6. Analyze the cash flow statement
Mainly depends on whether the cash flow statement can normally reflect the flow of funds and pay attention to the reasons and uses of future cash inflows and outflows.