Zacks.com Featured Highlights Include: Marcus, SkyWest, Acme And ACI
Zacks Investment Research | Apr 30, 2019 11:03PM ET
For Immediate Release
Chicago, IL – May 1, 2019 - Stocks in this week’s article The Marcus Corp. (NYSE:MCS) , SkyWest, Inc. (NASDAQ:SKYW) , Acme United Corp. (NYSE:ACU) and ACI Worldwide Inc. (NASDAQ:ACIW) .
Look Beyond Earnings: Bet on 4 Stocks with Rising Cash Flows
We are in the busiest week of this reporting cycle, and putting your hard earned money in stocks with high profits and earnings surprises is trendy. But looking beyond profits and figuring out whether they are being efficiently channeled to the company’s reserves can be a lot more rewarding. This is because, even though profit is a company’s goal, cash is its lifeblood for existence and a measure of resiliency.
In fact, a profit-making company can have a dearth of cash flow and might go bankrupt while meeting its obligations. But a company with a healthy cash level not only enjoys the flexibility to make decisions, chase potential investments and run its growth engine, but also weathers any market mayhem. Therefore, looking at a company’s ability to produce cash is important in terms of protecting your money in addition to multiplying it.
To find this efficiency, one needs to consider a company’s net cash flow figure. While in any business cash moves in and out, it is net cash flow that explains how much money a company is actually generating.
If a company is experiencing a positive cash flow then it denotes an increase in its liquid assets, which gives it the means to meet debt obligations, shell out for expenses, reinvest in business, endure downturns and finally return wealth to shareholders. On the other hand, a negative cash flow indicates a decline in the company’s liquidity, which in turn lowers its flexibility to support these moves.
However, having a positive cash flow merely does not secure a company’s future growth. To ride on the growth curve, a company must have its cash flow increasing because that indicates management’s efficiency in regulating its cash movements and less dependency on outside financing for running its business.
Therefore, keep yourself abreast with the following screen to bet on stocks with rising cash flows.
For the rest of this Screen of the Week article please visit Zacks.com at: Zacks Investment Research
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