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Yahoo
22 minutes ago
- Yahoo
Is Energy Action Limited (ASX:EAX) A High Quality Stock To Own?
Many investors are still learning about the various metrics that can be useful when analysing a stock. This article is for those who would like to learn about Return On Equity (ROE). By way of learning-by-doing, we'll look at ROE to gain a better understanding of Energy Action Limited (ASX:EAX). ROE or return on equity is a useful tool to assess how effectively a company can generate returns on the investment it received from its shareholders. In simpler terms, it measures the profitability of a company in relation to shareholder's equity. Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. How Do You Calculate Return On Equity? The formula for return on equity is: Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity So, based on the above formula, the ROE for Energy Action is: 33% = AU$1.1m ÷ AU$3.3m (Based on the trailing twelve months to December 2024). The 'return' is the amount earned after tax over the last twelve months. That means that for every A$1 worth of shareholders' equity, the company generated A$0.33 in profit. Check out our latest analysis for Energy Action Does Energy Action Have A Good ROE? One simple way to determine if a company has a good return on equity is to compare it to the average for its industry. The limitation of this approach is that some companies are quite different from others, even within the same industry classification. As is clear from the image below, Energy Action has a better ROE than the average (20%) in the Professional Services industry. That's what we like to see. However, bear in mind that a high ROE doesn't necessarily indicate efficient profit generation. A higher proportion of debt in a company's capital structure may also result in a high ROE, where the high debt levels could be a huge risk . To know the 4 risks we have identified for Energy Action visit our risks dashboard for free. How Does Debt Impact Return On Equity? Companies usually need to invest money to grow their profits. That cash can come from retained earnings, issuing new shares (equity), or debt. In the first and second cases, the ROE will reflect this use of cash for investment in the business. In the latter case, the debt used for growth will improve returns, but won't affect the total equity. In this manner the use of debt will boost ROE, even though the core economics of the business stay the same. Combining Energy Action's Debt And Its 33% Return On Equity It's worth noting the high use of debt by Energy Action, leading to its debt to equity ratio of 1.19. While no doubt that its ROE is impressive, we would have been even more impressed had the company achieved this with lower debt. Debt increases risk and reduces options for the company in the future, so you generally want to see some good returns from using it. Summary Return on equity is a useful indicator of the ability of a business to generate profits and return them to shareholders. In our books, the highest quality companies have high return on equity, despite low debt. All else being equal, a higher ROE is better. Having said that, while ROE is a useful indicator of business quality, you'll have to look at a whole range of factors to determine the right price to buy a stock. Profit growth rates, versus the expectations reflected in the price of the stock, are a particularly important to consider. Check the past profit growth by Energy Action by looking at this visualization of past earnings, revenue and cash flow. Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) 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. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
CBS News
24 minutes ago
- CBS News
CIA Director Ratcliffe "strongly supports" Gabbard declassification of sensitive documents, agency says
CIA Director John Ratcliffe "strongly supports the public release" this week of highly sensitive documents by Director of National Intelligence Tulsi Gabbard, according to a CIA spokesperson, who said Ratcliffe "initiated" the declassification process after he took the helm at the agency this year. Gabbard's office publicly released a report drafted in 2017 by Republicans on the House Intelligence Committee on Russian activity during the 2016 election, sparking concerns about risks to sensitive sources and methods. She said Wednesday that the document contained additional evidence that Obama administration officials "manufactured" a narrative about Russia's actions that was designed to undercut President Trump. Gabbard also declassified a swath of documents related to the 2016 election last Friday. "CIA Director Ratcliffe strongly supports the public release of HPSCI's report, which was the result of a process initiated by CIA and led by DNI Gabbard," the CIA spokesperson said, using an abbreviation for the House Permanent Select Committee on Intelligence. "This effort reflects Director Ratcliffe's continued commitment to elevating the truth and bringing transparency to the American people and would not have been possible without his directive to return it to the committee," the spokesperson added. The House report, which the committee's Republican staff finalized in December 2017 but updated through 2020, was so highly classified that it was stored at CIA headquarters before Ratcliffe sent it back to the House panel and ultimately toward public release, CBS News has learned. The committee made it available to the Office of the Director of National Intelligence, or ODNI, according to an ODNI official with knowledge of the declassification process. Gabbard would normally have been required to consult with the intelligence agencies that had contributed sensitive information to the report before declassifying it, but Mr. Trump — who made the decision to declassify the document with relatively few redactions — was not under the same obligations, the official said. The report was written in large part by then-committee staffer Kash Patel, now the FBI director, according to one current and one former official. It contained discussions about raw intelligence from a CIA source the agency had recruited in Russia, and questioned whether analysts had sufficiently taken into account the source's motivations, proximity to Putin or potential bias towards Mr. Trump. The CIA source's information helped inform the January 2017 Intelligence Community Assessment, or ICA, which concluded in part that Russian President Vladimir Putin and the Russian government aspired to help then-candidate Donald Trump's election chances by discrediting Secretary Clinton and publicly contrasting her unfavorably to him. The U.S. exfiltrated a CIA asset from Russia in 2017, CBS News previously confirmed. That judgment within the ICA has vexed Mr. Trump for years and has been a key focus of Gabbard's recent declassifications. Gabbard has claimed the documents released by her office reveal a "treasonous conspiracy" by Obama-era officials to undermine Mr. Trump during his first term by alleging Russian efforts to help him win in 2016. Gabbard says she has forwarded the records to the Justice Department as part of a criminal referral. Obama's spokesperson Patrick Rodenbush called Gabbard's accusations "bizarre" and "ridiculous" earlier this week. The ICA's judgement about Russian actions in 2016 was also the focus of a recent CIA internal review under Ratcliffe. Released earlier this month, that review contained far fewer of the sensitive details included in the House Republicans' report and said the judgment on Putin's preference for Trump should have been issued with moderate rather than high confidence. But it said it did not dispute the "quality and credibility" of the information. The top Democrat on the Senate Intelligence Committee, Sen. Mark Warner, called the release of the House committee's report by Gabbard "desperate and irresponsible." He said it put highly sensitive sources at risk and could disincentivize potential spies from working for the U.S. government. "Tell me how you're going to recruit somebody to, in one of our adversarial nations, maybe work with us, if that information is carelessly thrown around," Warner said to reporters on Wednesday. Ratcliffe, who previously served on the House Intelligence Committee as a congressman from Texas, has said one of his primary objectives as CIA director would be to reinvigorate intelligence collection from human sources. Current and former national security officials have said intelligence provided by human sources, known as HUMINT, has dropped off in recent years, as surveillance technologies have become more sophisticated and ubiquitous. Human sources — especially those with proximity to world leaders in adversarial countries like Russia, China and North Korea — are especially prized and especially rare, given how risky, if not life-threatening, it can be for them to provide information to a foreign intelligence agency. Information provided by human sources typically remains classified for decades, often up to 75 years, according to government classification rules. At his Senate confirmation hearing in January, Ratcliffe said the recruitment of human spies by the CIA is "not where it needs to be." "I do want to spend time looking at that," he said. The CIA has recently released recruitment videos in multiple languages with the aim of enticing potential human sources in Iran, China and Russia to come He and James LaPorta contributed to this report.
NBC News
24 minutes ago
- NBC News
Microsoft's Satya Nadella says job cuts have been 'weighing heavily' on him
Microsoft has laid off over 15,000 people so far in 2025. The stress of the belt-tightening has gotten to CEO Satya Nadella. 'Before anything else, I want to speak to what's been weighing heavily on me, and what I know many of you are thinking about: the recent job eliminations,' Nadella wrote in a memo to employees Thursday. After Microsoft's latest labor reductions, investors pushed the stock's closing price above $500 for the first time on July 9. The company announced the layoffs of about 9,000 people a week earlier. Microsoft employed 228,000 people as of June 2024. It hasn't provided a new figure that takes into account its layoffs this year, but Nadella wrote that headcount is basically flat. 'This is the enigma of success in an industry that has no franchise value,' he wrote. 'Progress isn't linear. It's dynamic, sometimes dissonant, and always demanding. But it's also a new opportunity for us to shape, lead through, and have greater impact than ever before.' The cuts at Microsoft are reflective of an overall trend across the tech industry, with over 80,000 positions eliminated to date in 2025, according to one count. Recruit Holdings announced earlier this month that it would lay off 1,300 people from its human resources technology segment that includes the Indeed and Glassdoor websites. The company's CEO pointed to artificial intelligence in a memo, Bloomberg reported. On social media in recent months, some Microsoft employees have become disheartened about the company's cutbacks, given its stature. 'I have loved working for this company, still do, but this has done so much damage to that loyalty because it has shown that Microsoft's espoused values do not apply to business decisions at the macro level,' a person who lists themselves as a Microsoft directed on LinkedIn posted last week. Microsoft is the world's most valuable public company after Nvidia, whose chips have become a critical piece of the AI arms race. Microsoft's Windows and Office franchises remain dominant, and its Azure cloud services have seen faster growth in recent years as OpenAI and other companies rent out Nvidia graphics cards to run AI models. In the memo, Nadella touched on Microsoft's mission for the past 10 years, which has been to empower every person and every organization on the planet to achieve more, and how the rise of AI is changing it. 'We must reimagine our mission for a new era,' he wrote. 'What does empowerment look like in the era of AI? It's not just about building tools for specific roles or tasks. It's about building tools that empower everyone to create their own tools. That's the shift we are driving — from a software factory to an intelligence engine empowering every person and organization to build whatever they need to achieve.'
