Connect with us

Business and Finance

It’s corporate earnings season. What does that mean – and why does it matter?

Published

on

‘Tis the season! But not one that involves gift-giving and carol singing. It’s Australia’s corporate profit season, where accountants can take centre stage.

Most firms listed on the Australian Stock Exchange (ASX) are required to supply an in depth report of their half-yearly leads to February and August annually.

It could appear boring, but it’s a blockbuster event within the financial world. Investors watch it with bated breath, and company stock prices can swing wildly in response to announcements.

And it matters quite a bit to all of us. Here’s why earnings season matters and the best way to make sense of all of the noise.



Companies receive a “scorecard” twice a 12 months

Earnings season can also be called “earnings season” or “reporting season.”

It falls at the identical time annually because all ASX-listed firms are required to report their profits inside two months of the top of their half-yearly reporting periods – normally January to June and July to December.

The earnings report is sort of a report card for a corporation and its management. It comprises key financial details about half-12 months results, equivalent to revenue, profit, earnings per share and quite a lot of other indicators.

Together, they supply vital details about an organization’s financial performance and financial condition.

Listed firms are required to publish their results a minimum of twice a 12 months.
Bianca De Marchi/AAP

What are the important thing numbers?

Let’s have a look at the three metrics that investors and analysts pay essentially the most attention to in an organization report. They can show you how to assess whether an organization is growing, stagnating, or declining.

Net Profit After Tax – “NPAT”

This number is the corporate’s “bottom line”—income minus expenses. It adds up all the corporate’s various sources of income and subtracts all incurred expenses, including taxes and interest.

Earnings Before Interest and Taxes – “EBIT”

EBIT remains to be a measure of profit, but unlike NPAT it does not include interest and taxes within the calculated costs of an organization.

Why ignore this stuff? Simply put, EBIT can provide you with a way of whether an organization is making good investment decisions, no matter how it is taxed or how it funds capital.

Earnings per share – “EPS”

EPS is calculated by dividing an organization’s NPAT by the variety of common shares outstanding. This indicates how much of an organization’s profit is attributable to every share.

It all revolves around expectations

Earnings season is a crucial opportunity for them to evaluate whether firms are meeting or exceeding market expectations – or not.

As with report cards, there are consequences to those “grades,” especially in the event that they become different than what the market expects. They can result in significant activity and short-term volatility within the stock market, with consequences for individual stock prices. Let’s have a look at a couple of examples from this month.

On August 14, Australian medical imaging company Pro Medicus announced a better-than-expected full-12 months net profit of A$82.8 million, up 36.5% from a 12 months earlier. The company’s share price closed the day 7.2% higher.

Two doctors examine brain images
Pro Medicus is an Australian medical imaging company.
ilustrissima/Shutterstock

The next day, Cochlear, a well-known company that makes hearing implants, also reported a 19% increase in net profit. However, its share price cut by 7% after the announcement.

Why does an organization’s stock price fall when its profits rise? Expectations are key here.

The current share price of an organization takes into consideration all publicly available information in regards to the company and its expected future results.

If earnings growth continues to fall in need of market expectations, as was the case for Cochlear, the stock price could fall.

Conversely, if the decline in earnings is smaller than expected or the projected losses are usually not as large as anticipated, the corporate’s share price may rise.

These each day swings in stock prices when earnings are announced might be unusually large, but commonplace. By comparison, average returns of benchmark stocks are typically around 10%.

This is very important for the economy

This should seem to be an enormous financial deal, however the implications of announcing financial results extend far beyond the particular firms involved within the project and the interested investors.

Australia has a comparatively small stock market, dominated by a couple of major players. The performance of those major firms during earnings season can often tell us something about broader economic trends, just as we use changes in gross domestic product (GDP) and inflation as economic indicators.

Strong financial results across key industries can indicate a healthy economy, while weak results can indicate economic problems.

For example, last week electronics retailer JB Hi-Fi announced that sales were higher than expected, which was interpreted the market suggests that weak consumer demand could also be ending more broadly.

Blurred customers walk in front of JB Hi-Fi store
Higher-than-expected profits at JB Hi-Fi suggested to the market that retail demand might be growing again.
Diego Fedele/AAP

Earnings reporting season also can provide some insights into industry trends.

For example, if many technology firms reported high profits over the identical period, market participants would quickly attempt to discover potential causes for the general industry growth – on this case, perhaps the increased use of artificial intelligence and related technologies.

This is very important for all of us too

Beyond our immediate concerns in regards to the economy, just about all of us have an extra, personal stake within the performance of those firms.

Whether we follow the market or not, our growing superannuation nest eggs are linked to its performance. For those of us still working, long-term performance matters more, but nobody desires to see the market fall once they retire.

Whether you follow the stock market closely or not, what happens during earnings season will impact you.


This article was originally published on : theconversation.com
Continue Reading
Advertisement
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Business and Finance

How a Black-owned radio station stayed independent for 50 years while other media became corporatized.

Published

on

By

WDKX, WDKX Radio, WDKX Rochester, Rochester radio stations, B lack-owned radio stations, WDKX Andria Langston, theGrio.com

If you have ever checked out a radio station’s call letters, it can have gave the impression of they were just letters to you.

But at WDKX radios in Rochester, New York, the letter “D” stands for Frederick Douglass, “K” stands for Martin Luther King Jr., and “X” stands for

In a media environment where many Black radio stations that air promoting to Black listeners usually are not Black-owned, WDKX exemplifies the legacy and power of independent Black media. This yr the station is celebrating 50 years in business.

According to African American Public Radio Consortiuman estimated 10,000 industrial radio stations broadcast each day within the U.S., but lower than 1% are black-owned. This discrepancy reveals greater than just an ownership gap; highlights a systemic problem that ends in fewer Black leaders being accountable for the voices and messages that claim to talk for Black people.

“Anyone can play black music or turn on black shows, but with black creators there is a different kind of authenticity and connection,” says Andria Langston, current co-owner of WDKX and national sales manager.

Langston is Andre Langston’s daughter and granddaughter Andrew Langstonwho founded WDKX in 1974 in Rochester. While the northern New York city is commonly considered a destination for abolitionists like Frederick Douglass, that does not imply racism wasn’t prevalent in the realm.

Andrew Langston (right) is the founder and visionary of WDKX Radio, which he founded in 1974. (Photo via WROC-TV)
(*50*)
Andria Langston poses along with her father, Andre Langston, current owner of WDKX radio in Rochester, New York, who made sure the station remained independently owned. (Photo courtesy of The Langston Family)
(*50*)

“My grandfather was a visionary, and interestingly enough, he moved to Rochester, New York, because he was promised a job at CBS,” Langston tells Grio. “But when he got there and they saw he was black, they didn’t want to show him on TV. Being in Rochester during the Rochester Riots, my grandparents saw there was a need to tell our story.”

Today, WDKX is a model of resilience, being certainly one of the last independently operated Black-owned radio stations within the United States. The station organizes community events and highlights issues related to health, education and politics. Its mission is deeply rooted within the vision of Mr. Langston, who overcame regulatory and racial barriers to create a platform dedicated to authentic Black voices. For Andria, who began learning the station’s operations on the age of 5, that is of great importance.

“I’m a third-generation owner and seeing my grandfather build this station throughout my life and my father continuing it, I think it’s a testament to the American dream; what can be achieved with persistence and community and simply focusing on your goals,” Langston tells theGrio.

(*50*)

Like many Black-owned public radio stations, WDKX attracts socially and culturally aware listeners who help keep this legacy alive. Although many African-American public radio stations are licensed by universities – accounting for 70% of all such stations, including NPR affiliates – WDKX is certainly one of the few that also operates independently.

This weekend, as WDKX celebrates its fiftieth anniversary, it does in order a testament to the importance of getting Black people in media. From its commitment to unfiltered storytelling to its ability to construct authentic connections, WDKX stays a critical voice in an era where community-centered, Black-owned media is required greater than ever. For listeners in Rochester and beyond, WDKX is greater than just a radio station. It reminds us of the strength and resilience that comes from having your personal narrative.

“My grandfather was in his 40s when he finally started a radio station,” Langston explains. “So you may have a dream in your 20s and it should take you years to comprehend it. Don’t surrender in your dreams. To proceed. Because you have got time and there may be enough for everyone here.

Featured Stories

This article was originally published on : thegrio.com
Continue Reading

Business and Finance

No, the boom in battery factories in America is not over – construction of the largest factories is proceeding as planned and it is planned to employ over 23,000 people

Published

on

By

The United States is experiencing the largest-ever boom in investment in clean energy production, driven by laws such as the bipartisan bill Act on infrastructure investments and employment and Act on reducing inflation.

They have these rights used billions of dollars government support to drive private sector investment in clean energy supply chains across the country.

For several years, one of us, Jay Turner, and his students at Wellesley College have been tracking clean energy investments in the U.S. and sharing the data on the website The big green machine website. This study shows that since the Inflation Control Act went into effect in 2022, firms have announced 225 projects with a complete investment of $127 billion and the creation of greater than 131,000 latest jobs.

You could have seen on the news that these projects are in danger of failure or significant delays. In August 2024, the Financial Times reported this. 40% of over 100 projects he assessed that they were delayed. These include battery production, renewable energy and metals and hydrogen projects, as well as semiconductor manufacturing plants. The technology industry magazine The Information recently warned of this 1 in 4 firms left from government subsidies for investment in batteries.

Workers assemble battery packs for electric vehicles in Spartanburg, South Carolina. New battery factories in the state will help move the supply chain closer to U.S. electric vehicle factories.
BMW

We checked all 23 battery cell factories announced or prolonged since the Inflation Reduction Act was signed into law – just about all of them are gigafactories which might be expected to produce greater than 1 gigawatt-hour of battery cell capability. These factories have one of the highest employment potentials of all the projects supported by the Act.

We wanted to discover whether the U.S. clean energy production boom was about to fizzle out. Most of what we learned is reassuring.

The largest battery factories are on the right track

While exact investment amounts are difficult to determine, our study shows that planned capital expenditure shall be $52 billion, which would supply 490 gigawatt-hours of battery production capability per 12 months – enough to put about 5 million latest electric vehicles on the road.

While not all 23 firms have announced hiring plans, the facilities are expected to create nearly 30,000 latest jobs, with projects primarily in the U.S. Southeast, Midwest and Southwest.

We wanted to know whether these projects were progressing as planned or whether there have been delays or problems.

To do that, we first contacted local and state economic development agencies. In many cases, local and state tax incentives support these projects. Where possible, we now have tried to confirm the status of the project through public data Or formal announcements. In other cases, we looked for messages to see in the event that they existed construction proof Or hiring.

Our study shows that 13 of 23 projects are on the right track, with total planned capital investment exceeding $40 billion and production capability of nearly 352 gigawatt hours per 12 months. Importantly, they include most of the largest projects with the largest investments and expected production.

Our calculations show that 77% of total planned capital investment, 79% of proposed jobs, and 72% of planned battery production are on the right track, meaning the project is likely to be accomplished roughly on time and overall as expected. result. level of investment and employment.

Three projects are on the bubble. These have shown progress but have experienced delays in construction or financing.

Five others show deeper signs of distress. We do not yet have enough information to draw conclusions about the two projects.

An example of an ongoing project is the Envision AESC battery plant in Florence, South Carolina. His the scale has been enlarged twice since it was first announced in December 2022. It is now a $3 billion investment with the goal of producing 30 gigawatt-hours of batteries per 12 months supplies the BMW factory in Woodruff, South Carolina.

In early October 2024, South Carolina Secretary of Commerce Harry Lightsey visited the Envision i facility published a video. Construction of the plant began in February 2024, and 850 employees are working six days per week to complete the 1.4 million square foot facility by August 2025. Once full production begins, the project shall be accomplished expected to hire 2,700 people.

The 2024 elections could end or speed up the boom

However, much relies on what is going to occur in the upcoming elections.

Our data suggests that the real risk facing these projects and projects like them is not sluggish demand for electric vehicles, as some suggest – in fact demand continues to grow. It’s not the local opposition that did it either it only slowed down a number of projects.

The the biggest risk is policy change. Many of these projects are counting on advanced manufacturing tax credits approved by the Inflation Reduction Act through 2032.

During the campaign, Republicans are promising to repeal key laws under Biden, including the Inflation Reduction Act, which incorporates funding for grants and loans to support clean energy, as well as tax incentives to support domestic manufacturing.

While an entire repeal of the Act could also be unlikely, an an administration hostile to clean energy redirect unspent funds to other purposes, slow the pace of grants or loans by slow project approvals, or find other ways to make tax incentives tougher to obtain. Although our research focused on the battery industry, concerns concern investments in wind energy AND solar energy too.

So will the great U.S. boom in clean energy production soon come to an end? Our data is optimistic, but the policy is uncertain.

This article was originally published on : theconversation.com
Continue Reading

Business and Finance

Jaylen Brown is launching his own sports brand thanks to Kobe Bryant

Published

on

By


NBA champion Jaylen Brown did the other of most superstars once they were offered a giant contract. He turned down the offer, but as a substitute decided to start his own brand, crediting the thought to the late Kobe Bryant.

In an exclusive interview with and , a Boston Celtics player discussed his latest enterprise, 741, a footwear and sports brand. After meeting with several firms and never feeling the offers thrown at him, Brown announced that he followed the trail that the nice Kobe planned. The Lakers legend was planning to start his own sports company, so he decided to do the identical.

After turning down $50 million in sponsorship deals, he launched 741 in September.

“Honestly, I got the thought from Kobe (Bryant), rest in peace. Before his death, he planned to launch his own shoe brand, sign contracts with athletes and offer them higher deals and percentages. I remember reading an article about it and pondering it was bullshit. I analyzed my own experiences of working for big corporations and the way they value your creativity and also you. I’ve tried every brand and none of them stood out. Everyone approaches things the identical way. I used to be on the lookout for a brand of the long run, not a brand of the past. I could not find it so I had to start.

Brown also stated that he also helped design products for his line. Outside of design, he said that creating 741 allowed him to explore his creativity.

“I designed all the pieces myself. I used to be just on the factory in South Korea, on the road, ensuring all the pieces was done the way in which I believed it must be. I’ve done probably close to $50 million value of deals (from other brands) to start something on my own. And it wasn’t because I didn’t like the cash they were offering. It’s because these contracts pigeonholed me and didn’t allow me to be creative.

Brown also said he didn’t want to force anything when it comes to brand promotion. He favors a slow-build approach and admitted that “it doesn’t have to be the hottest brand on the street tomorrow.”


This article was originally published on : www.blackenterprise.com
Continue Reading
Advertisement

OUR NEWSLETTER

Subscribe Us To Receive Our Latest News Directly In Your Inbox!

We don’t spam! Read our privacy policy for more info.

Trending