Download or read book Information Content of Cash Flow from Operations in the Prediction of Future Earnings written by Tong Li and published by . This book was released on 1997 with total page 288 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Informativeness and Predictability of Earnings and Cash Flows written by Zhemin Wang and published by . This book was released on 1991 with total page 236 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Beyond Earnings written by David A. Holland and published by John Wiley & Sons. This book was released on 2017-12-04 with total page 417 pages. Available in PDF, EPUB and Kindle. Book excerpt: Beyond Earnings is targeted at investors, financial professionals, and students who want to improve their ability to analyze financial statements, forecast cash flows, and ultimately value a company. The authors demonstrate that reported earnings are easily gamed by accounting shenanigans and reveal how commonly used profitability measures such as return on equity can be misleading. Because earnings and P/E ratios are too unreliable for valuation, this book takes you beyond earnings and shows you how to apply the HOLT CFROI and Economic Profit framework in a step-by-step manner. A better measure of profitability results in improved capital allocation decisions and fundamental valuations. This ground-breaking book offers the first practical in-depth discussion of how profitability and growth fade, and shows how to put this information to work right away. The authors introduce their trailblazing Fundamental Pricing Model which includes fade as an adjustable value driver and can be used to value the impact of business model disruption. As the authors explain, the key to superior stock picking is understanding the expectations embedded in a stock’s price and having a clear view of whether the company can beat those expectations. The HOLT framework has been rigorously field tested for over 40 years by global investment professionals to help them make better stock picks and by corporate managers to understand the expectations embedded in their stock price. Beyond Earnings is an indispensable guide for investors who want to improve their odds of outperforming the competition.
Download or read book Cash Flow Analysis and Forecasting written by Timothy Jury and published by John Wiley & Sons. This book was released on 2012-05-03 with total page 341 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book is the definitive guide to cash flow statement analysis and forecasting. It takes the reader from an introduction about how cash flows move within a business, through to a detailed review of the contents of a cash flow statement. This is followed by detailed guidance on how to restate cash flows into a template format. The book shows how to use the template to analyse the data from start up, growth, mature and declining companies, and those using US GAAP and IAS reporting. The book includes real world examples from such companies as Black and Decker (US), Fiat (Italy) and Tesco (UK). A section on cash flow forecasting includes full coverage of spreadsheet risk and good practice. Complete with chapters of particular interest to those involved in credit markets as lenders or counter-parties, those running businesses and those in equity investing, this book is the definitive guide to understanding and interpreting cash flow data.
Download or read book Cash Flow Forecasting written by Andrew Fight and published by Elsevier. This book was released on 2005-10-12 with total page 263 pages. Available in PDF, EPUB and Kindle. Book excerpt: Budgets are like road maps -- they provide a direction for a corporates financial management. Balance sheets and statements of revenues also provide insights into how well a company is following that direction. But cash flow and cash flow forecasts are what guide the day-to-day itinerary for an organization. Budgets and cash flow are dynamic -- adjustments and changes can and should occur. If you understand what you are looking at, you can use cash flow to create better budgets and thus more accurate cash flow forecasting. Cash Flow Forecasting outlines the techniques required to undertake a detailed analysis of the cash flow dynamics of the business from both a historical and forward looking perspective. Cash Flow Forecasting explains how to: * Determine appropriate cash flow figures from pro forma financial statements * Interpret detailed cash flow forecasts and understand the difference between profit and cash flow * Conserve or generate cash in the short term * Evaluate different methods of project evaluation * Recognize the limitations of accounting information in valuing companies *Inspired by basic entry level training courses that have been developed by major international banks worldwide * Will enable students and those already in the finance profession to gain an understanding of the basic information and principles of cash flow forecasting * Includes questions with answers, study topics, practical "real world" examples and extensive bibliography
Download or read book The Effect of Contextual Factors on the Information Content of Cash Flows in Explaining Stock Prices the Case of Amman Stock Exchange written by Ali M. Al-Attar and published by . This book was released on 2009 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This article aims to determine which is better earnings or cash flows as performance measure. We follow the more direct approach used in several recent U.S. studies, in which earnings and cash flows are considered as competing variables. Specifically, our methodology is a development of the study of Dechow (1994). We provide a replication of her main analysis, and then extend this to deal with the effect of earnings permanence, earnings growth and firm size on the value relevance of cash flow and earnings. Our study provides an evidence on the relevance of cash flow figures for investors in their investment decision in an emerging stock market. The study covers the case of Amman Stock Exchange (ASE) and employs data on a sample of industrial firms. The time horizon of this study includes the period of 1993-2001. The results of the current study indicate that earnings and cash flows have information content regarding the prediction of future cash flows. Cash flows and earnings separately have a significant association with stock return. The results show that there is no significant difference between the ability of earnings and cash flows in explaining the variation in stock return. Furthermore, as the earnings growth is low and the firm's size is small, the operating cash flow considered better than earnings as performance measure.
Download or read book Do Investors Fully Understand the Economic Implications of Cash Flows from Operations written by Mei Luo and published by . This book was released on 2004 with total page 178 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book the nature and amount of information reflected in cash flows and accruals written by victor l. bernard and thomas l. stober and published by . This book was released on 1989 with total page 56 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Testing the Cash flow Relevance of Three Concepts of Profit written by Robert F. Sharp and published by . This book was released on 1980 with total page 56 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book An Empirical Investigation of the Usefulness of Earnings in Predicting Future Enterprise Cash Flows written by John Edward Brooks and published by . This book was released on 1981 with total page 306 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Comparative Predictive Abilities of Earnings and Operating Cash Flows on Future Cash Flows written by Joseph Agana and published by . This book was released on 2016 with total page 6 pages. Available in PDF, EPUB and Kindle. Book excerpt: Cash flow prediction is an essential component of economic decision making, particularly in investment and credit evaluation. This paper examines the comparative predictive ability of earnings and operating cash flows variables on future operating cash flows within a developing economy's setting. Ordinary Least Squares (OLS) method is used to develop regression models over the period of 2002 to 2012. Current operating cash flows, as proxy for future operating cash flows, are regressed on past one, two and three years of earnings and operating cash flows as predictors. Results from the regression analysis reveals earnings and operating cash flows are significant in predicting future operating cash flows but have different predictive powers with earnings providing a superior comparative predictive ability on future cash flows. The paper therefore concludes that earnings are a better predictor of future operating cash flows than historical operating cash flows itself.
Download or read book Financial Statement Analysis written by Ray Ball and published by McGraw-Hill Companies. This book was released on 1994 with total page 788 pages. Available in PDF, EPUB and Kindle. Book excerpt: Textbook
Download or read book Real Earnings Management and the Relevance of Operating Cash Flows written by Saoussen Boujelben and published by . This book was released on 2021 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: The primary focus of this study is to investigate whether the level of earnings management through real activities (REM)affects the value relevance of reported cash flows from operations (CFO), precisely with regard to their ability to predict futureCFOs. Using the data related to CAC all tradable listed French firms during 2008 through 2015, we provide evidence whichsupports the expected decrease in value relevance of reported CFO for future CFOs' prediction in the presence of REM. Ourfinding highlights the fact that if managers decide to manipulate upward earnings through operating activities, they couldadversely affect the information content of CFOs. More precisely, an aggressive deviation from normal activities leads toabnormal levels of the main operating inflows and outflows in an inconsistent way and this deteriorates the value relevanceof cash flows from operations. This contribution is of use for creditors and investors and other key CFO users for predictionpurposes as it urges them to make necessary adjustments when predicting the future ability of an entity to generate cash flows.
Download or read book The Consistent Estimation of Future Cash Flow and Future Earnings written by Ehsan Khansalar and published by . This book was released on 2011 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: In empirical financial accounting research, there continues to be a debate as to what the best predictors of future earnings and future cash flows might be. Past accruals, earnings and cash flows are the most common predictors, but there is no consensus over their relative contributions, and little attention to the underlying accounting identities that link the components of these three prominent variables. The aim of this thesis is to investigate this controversy further, and to apply an innovative method which yields consistent estimations of future earnings and cash flows, with higher precision and greater efficiency than is the case in published results to date. The estimation imposes constraints based on financial statement articulation, using a system of structural regressions and a framework of simultaneous linear equations, which allows for the most basic property of accounting - double entry book-keeping - to be incorporated as a set of constraints within the model. In predicting future cash flows, the results imply that the constrained model which observes the double entry condition is superior to the models that are not constrained in this way, producing (a) rational signs consistent with expectations, not only in the entire sample but also in each industry, (b) evidence that double entry holds, based on the Wald test that the estimated marginal responses sum to zero, and (c) confirmation of model improvement by way of a higher likelihood and greater precision attached to predictor variables. Furthermore, by then using an appropriately specified model that observes the double entry constraint in order to predict earnings, the thesis reports statistically significant results, across all industries, that cash flows are superior to accruals in explaining future earnings, indicating also that accruals with a lower level of reliability tend to be more relevant in this respect.
Download or read book Do Direct Cash Flow Disclosures Help Predict Future Operating Cash Flows and Earnings written by Steven F. Orpurt and published by . This book was released on 2013 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Motivated by recent FASB, IASB, and CFA Institute comments, we explore the predictive value of direct method cash flow disclosures. A primary stated purpose of the direct method is to better forecast future performance. To examine this purpose, we first document that direct method line items such as cash received from customers are not reliably estimable using income statements and either balance sheets or indirect method statements of cash flows. When these estimation (articulation) errors are included in cash flows and earnings forecasting models, forecasting performance significantly improves. In addition, employing a FERC (future ERC) methodology, we find evidence suggesting that market participants utilize direct method disclosures for their stated purpose: to better forecast future operating performance. After conducting several tests for self-selection concerns, we conclude that the direct method is valuable to investors when forecasting future cash flows and earnings.
Download or read book Earnings Or Cash Flows written by A. Rashad Abdel-Khalik and published by . This book was released on 1979 with total page 118 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Analysts Use of Accruals and Cash Flows in Forecasting Earnings written by Ramesh Narayana Chari and published by . This book was released on 1998 with total page 140 pages. Available in PDF, EPUB and Kindle. Book excerpt: This research investigates whether financial analysts fully incorporate the information contained in accrual and cash flow components of current earnings when forecasting future earnings. I present evidence that analysts fail to fully incorporate the implications of these components for earnings persistence in their forecasts. Analysts' appear to ignore information in past earnings to a greater extent when the magnitude of accruals in prior year earnings is large relative to cash flows. I find that information in these components can be used to improve analysts' forecasts. This improvement is most evident for firms which have a high incidence of accruals in prior year earnings. I demonstrate the economic significance of improving analysts' forecasts by implementing a trading strategy that predicts stock price changes. This trading strategy yields significantly positive risk-adjusted abnormal returns. These results suggest that analysts' forecasting inefficiency (see Mendenhall, 1991) is potentially rooted in their misperceptions about the implications of accruals and cash flows for earnings persistence. These findings are useful to accounting standard-setters and to capital markets research that uses analysts' forecasts to proxy for earnings expectations.
