A Cheap Chinese Stock Posting +300% Earnings Growth
October 30, 2010 at 06:34 AM EDT
It's pretty simple really. You sell products, you bring in revenue. Subtract whatever cash was spent on those products (cost of goods sold) and you have gross profit. The larger the gross profit, the more earnings are left over once all the other day-to-day expenses are paid. For many companies, the cost of goods sold can really eat into the bottom line . Think of the mountains of grains and sugar that cereal maker Kellogg's (NYSE: K) has to procure. The company took in $12.6 billion in revenue last year, but spent more than $7.2 billion (57%) on raw ingredients that went into all those boxes of Rice Krispies and Frosted Flakes. Even firms with smaller budgets… . . . → Full Story: A Cheap Chinese Stock Posting +300% Earnings Growth