Dongwoo Farm To Table Co's (KOSDAQ:088910) Earnings Are Of Questionable Quality

Despite posting some strong earnings, the market for Dongwoo Farm To Table Co ., Ltd's (KOSDAQ:088910) stock hasn't moved much. Our analysis suggests that shareholders have noticed something concerning in the numbers.

See our latest analysis for Dongwoo Farm To Table Co

The Impact Of Unusual Items On Profit

Importantly, our data indicates that Dongwoo Farm To Table Co's profit received a boost of ₩12b in unusual items, over the last year. We can't deny that higher profits generally leave us optimistic, but we'd prefer it if the profit were to be sustainable. We ran the numbers on most publicly listed companies worldwide, and it's very common for unusual items to be once-off in nature. Which is hardly surprising, given the name. Dongwoo Farm To Table Co had a rather significant contribution from unusual items relative to its profit to December 2023. As a result, we can surmise that the unusual items are making its statutory profit significantly stronger than it would otherwise be.

Note: we always recommend investors check balance sheet strength. Click here to be taken to our balance sheet analysis of Dongwoo Farm To Table Co.

Our Take On Dongwoo Farm To Table Co's Profit Performance

As we discussed above, we think the significant positive unusual item makes Dongwoo Farm To Table Co's earnings a poor guide to its underlying profitability. As a result, we think it may well be the case that Dongwoo Farm To Table Co's underlying earnings power is lower than its statutory profit. The good news is that, its earnings per share increased by 64% in the 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. In light of this, if you'd like to do more analysis on the company, it's vital to be informed of the risks involved. Every company has risks, and we've spotted 3 warning signs for Dongwoo Farm To Table Co you should know about.

Today we've zoomed in on a single data point to better understand the nature of Dongwoo Farm To Table Co's profit. But there is always more to discover if you are capable of focussing your mind on minutiae. For example, many people consider a high return on equity as an indication of favorable business economics, while others like to 'follow the money' and search out stocks that insiders are buying. While it might take a little research on your behalf, you may find this free collection of companies boasting high return on equity, or this list of stocks that insiders are buying to be useful.

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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.