Invest in a Company That You Know Well (2)

Where are the profits coming from?

Most companies make profits from its businesses.

But there are companies that will make profit because of other reasons.

For example, a company may declare a profit because it has disposed of its assets.

In these circumstances, the profit may not be sustainable if it is not generated from its core business.

Read through the company’s accounting statements to determine its source of profitability and at the same time,

always check the debt level of the company.