Hunting for Hidden Financial Risks | Stephen Clapham
Forward Guidance
00:00
The Red Flags of Dodgy Companies
I've got three main things I look at. The first is margins. Is the company making margins that are similar to its peers? Or if they're higher than peers, is there a good reason for that? If you don't generate any cash, then the chances are your numbers aren't right. And if you have rising receivables, it's a classic indicator of a company that's cheating in management or engaged in fraud.
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