Question: Financial statement analysis

Hello everyone. I have a question on financial statement analysis. The revenues listed on the income statement do NOT refer only to money made from products sold but to all money taken in by the company for that reported period. Am I correct about this???? For example, if a company sells new stock issues or gets a new loan from a bank, would the money gained from those transactions be included in the revenues number in the income statement? Thanks in advance for your response.

Thomas Villarubia: Ok. Thanks for the reply. So if a company sells stock to raise cash or acquire debt it would not show up under revenues. The reason I’m asking is I’d like to know if the revenue numbers could be trusted. Everyone knows that the earnings number can be manipulated by selling off assets or acquiring another company. I just wanted to know if its was the same with the revenue numbers.

Thomas Villarubia: I’ve noticed a lot of companies boasting increased revenue but if you look at the cash flow statement they’re also increasing debt and selling off more stock. I was wondering if that was the reason the revenues were increasing

Thomas Villarubia: Ok. It’s earnings season and I noticed alot of companies boasting about there revenues.

Thomas Villarubia: That’s what I thought. I could never figure out why revenues would increase but net income would be done. Thanks for the advice

Thomas Villarubia: Exactly. I’ve noticed a lot of these solar stocks are boast revenues but there net income is in the tank. It shows in there stock price too. Cash flow statements show there living off of debt and new issuance of stock.

Thomas Villarubia: Yea it’s a pretty good article. I’m noticing it’s harder to find good companies with decent valuations and a profitable record. I don’t know if it’s just me or the bears are correct that this bull market has gone on too long. But I am finding it harder to find companies that are good investments based on valuation and profitability

Rakesh Rai: Depend upon Industry to industry.Generally these are part of Other income in income statement or Investment or Interest income .