Stock Analysis
When companies post strong earnings, the stock generally performs well, just like Genting Malaysia Berhad's (KLSE:GENM) stock has recently. We did some digging and found some further encouraging factors that investors will like.
Check out the opportunities and risks within the MY Hospitality industry.
For anyone who wants to understand Genting Malaysia Berhad's profit beyond the statutory numbers, it's important to note that during the last twelve months statutory profit was reduced by RM132m due to unusual items. It's never great to see unusual items costing the company profits, but on the upside, things might improve sooner rather than later. When we analysed the vast majority of listed companies worldwide, we found that significant unusual items are often not repeated. And, after all, that's exactly what the accounting terminology implies. Assuming those unusual expenses don't come up again, we'd therefore expect Genting Malaysia Berhad to produce a higher profit next year, all else being equal.
That might leave you wondering what analysts are forecasting in terms of future profitability. Luckily, you can click here to see an interactive graph depicting future profitability, based on their estimates.
Unusual items (expenses) detracted from Genting Malaysia Berhad's earnings over the last year, but we might see an improvement next year. Based on this observation, we consider it likely that Genting Malaysia Berhad's statutory profit actually understates its earnings potential! And it's also positive that the company showed enough improvement to book a profit this year, after losing money last year. The goal of this article has been to assess how well we can rely on the statutory earnings to reflect the company's potential, but there is plenty more to consider. If you want to do dive deeper into Genting Malaysia Berhad, you'd also look into what risks it is currently facing. To that end, you should learn about the 3 warning signs we've spotted with Genting Malaysia Berhad (including 1 which doesn't sit too well with us).
This note has only looked at a single factor that sheds light on the nature of Genting Malaysia Berhad's profit. But there are plenty of other ways to inform your opinion of a company. Some people consider a high return on equity to be a good sign of a quality business. So you may wish to see this free collection of companies boasting high return on equity, or this list of stocks that insiders are buying.
Find out whether Genting Malaysia Berhad is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Genting Malaysia Berhad, together with its subsidiaries, engages in the leisure and hospitality business in Malaysia, the United Kingdom, Egypt, the United States, and the Bahamas.
The Snowflake is a visual investment summary with the score of each axis being calculated by 6 checks in 5 areas.
Read more about these checks in the individual report sections or in our analysis model.
Undervalued with reasonable growth potential.
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