easy · Corporate Credit Analysis fsa

If an analyst says a company's 'earnings quality' is low despite a high EBITDA, what might they be referring to?

1. The firm has a very low amount of debt in its capital structure.
2. The firm's EBITDA is not translating into actual Cash Flow from Operations.
3. The firm is paying too much in dividends to its common shareholders.
4. The company's stock price is trading at a low multiple of its earnings.

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