Net operating assets change rate
factor.formula
Net operating assets change rate calculation formula:
Net Operating Assets (NOA) Calculation Formula:
Simplified calculation formula for net operating assets:
In the formula:
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Represents the net operating assets of the most recent reporting period (period t).
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Represents the net operating assets in the same period of the previous year (period t-1).
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Represents the total assets of the most recent reporting period (period t).
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Represents total shareholders' equity, including minority interests.
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Represents financial liabilities, usually including short-term loans, long-term loans, bonds payable, etc.
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Represents financial assets, usually including trading financial assets, available-for-sale financial assets, etc.
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Represents operating assets, usually including inventory, accounts receivable, prepaid expenses, etc.
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Represents operating liabilities, usually including accounts payable, advances received, employee salaries payable, etc.
factor.explanation
This factor measures the change in a company's net operating assets. A high rate of change usually means that the company is too aggressive in expanding operating assets (such as inventory and accounts receivable) or reducing operating liabilities (such as accounts payable). This aggressive expansion or contraction may lead to inefficient resource allocation, increase financial risks, and thus affect the company's future profitability. Therefore, companies with a high rate of change in net operating assets are often considered to be riskier, and their future earnings may be lower than the market average. This factor mainly reflects the company's aggressiveness and financial risks in its operating activities.