We Think You Can Look Beyond Ryoden's (TSE:8084) Lackluster Earnings
Ryoden Corporation (TSE:8084) reported soft earnings, but shareholders remain unconcerned due to strong business fundamentals. The company's accrual ratio of -0.24 indicates that free cash flow significantly exceeded statutory profit, with free cash flow at JP¥20b compared to JP¥4.84b in profit. However, profits were boosted by unusual items worth JP¥832m, raising concerns about sustainability. Analysts suggest that while the cash conversion is solid, future profits may be weaker without these unusual boosts. Investors are advised to consider potential risks and the company's balance sheet strength.
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