Fleetwood's (ASX:FWD) Performance Is Even Better Than Its Earnings Suggest
Fleetwood Limited (ASX:FWD) has shown strong earnings, but the stock price reaction has been subdued, indicating that investors may be overlooking positive underlying factors. The company reported a negative accrual ratio of -0.18, suggesting excellent cash conversion, with free cash flow of AU$36m significantly exceeding its statutory profit of AU$14.6m. Unusual items reduced profit by AU$9.1m, but if these do not recur, future profitability may improve. Despite its earnings quality, Fleetwood has two warning signs that investors should consider.
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