easy · Corporate Credit Analysis
If an analyst says a company's 'earnings quality' is low despite a high EBITDA, what might they be referring to?
- The firm has a very low amount of debt in its capital structure.
- The firm's EBITDA is not translating into actual Cash Flow from Operations.
- The firm is paying too much in dividends to its common shareholders.
- The company's stock price is trading at a low multiple of its earnings.
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