This Little-Known Metric Is the Best Measure of Profitability

It's Shah's go-to number... [Total Wealth] BROUGHT TO YOU BY MANWARD PRESS This Little-Known Metric Is the Best Measure of Profitability SPONSORED [DPL Logo]( - Look Over Multimillionaire Trader Nate Bear's Shoulder During His "Millionaire Trading Blitz" - 1 Full Week of Trading ([Discover Powerful New Strategies That Work!]( - It's All 100% FREE! [CLICK HERE TO RESERVE YOUR FREE SPOT NOW (WHILE THERE'S STILL SPACE!)]( [Shah Gilani] Shah Gilani Chief Investment Strategist The world of financial analysis can seem very confusing... or even deliberately so. You've got metrics like net income... earnings... and multiple profitability measures... All are used to assess a company's financial health and likely stock performance. But among these metrics... one has the greatest weight. And it's been my go-to measure of a company's profitability for decades. I'm talking about "net income available to common shareholders." SPONSORED [Can you guess these five letters?]( _ _ _ _ _ For 27 years, they've been the key to beating the market by more than 550% ([Get the answer here]( The Starting Point Net income available to common shareholders is almost always overshadowed by its broader counterparts. But it provides a much clearer picture of a company's profitability and value. Net income is the bottom line or profit. It's a fundamental metric that represents the amount of revenue that exceeds expenses. It's calculated by subtracting all expenses, including taxes and interest, from total revenue. Net income is a critical indicator of a company's ability to generate "earnings" from its core operations. And smart investors know earnings are a masterfully massaged metric. Earnings include various measures of profitability, including gross profit, operating profit and net profit. They offer insights into how well a company operates and how efficient it is... But it's impossible to know which version of earnings - and what's in that particular bucket - is being used to calculate EPS, or earnings per share. SPONSORED [The Renegade Millionaire Who Called the 2008 Housing Crash Says "The Next Big Short Is Here!"]( [The Next Big Short]( It's been unfolding for 15 years. It's going to decimate a $21 trillion industry and wipe out unsuspecting investors. At the same time, it's going to make a handful of savvy investors very rich. Pro traders have already played this crisis for $600 million in a single day. And now, the big trades are setting up. [Go here now to get your shot at this unprecedented opportunity...]( More Precise Net income available to common shareholders is what I call a "refined metric." It specifically focuses on the portion of a company's net income attributable to common shareholders after deducting preferred dividends. It reflects the earnings generated per share of common stock outstanding. That makes it a crucial metric for investors. By deducting dividends, the number provides a clearer picture of the earnings that can be distributed. Here's why that's important... - Shareholder Value Focus: Shareholders are the primary stakeholders in a company. They want to maximize the return on their investment. Net income available to common shareholders aligns with their interests and provides a clearer gauge of shareholder value. - Dividend Sustainability: The amount of net income available after accounting is vital in assessing the sustainability of dividend payouts. (That's how I came across the metric more than 20 years ago.) A higher net income available to common shareholders indicates stronger financial stability and ability to maintain or increase dividends. - Investor Decision-Making: When deciding where to put their money, investors need to consider the potential returns. Net income available to common shareholders serves as a key input in assessing the profitability and growth prospects of a company. It helps investors make informed choices. While net income and earnings metrics can tell you a lot about a company's financials... net income available to common shareholders is a far more precise measure of profitability and shareholder value. It provides a clearer picture of a company's ability to generate returns for its investors. All investors should use this metric to make well-informed decisions about the stocks they want to buy. I always do. Cheers, Shah Want more content like this? [YES]( [NO]( Shah Gilani Shah Gilani is the Chief Investment Strategist of Manward Press. Shah is a sought-after market commentator... a former hedge fund manager... and a veteran of the Chicago Board Options Exchange. He ran the futures and options division at the largest retail bank in Britain... and called the implosion of U.S. financial markets (AND the mega bull run that followed). Now at the helm of Manward, Shah is focused tightly on one goal: to do his part to make subscribers wealthier, happier and freer. You are receiving this email because you subscribed to Total Wealth. To unsubscribe from Total Wealth, [click here](. Need help with your account? [Click here](. Have a question or comment for the editor? [Click here](mailto:mailbag@manwardpress.com). Please do not reply to this email as it goes to an unmonitored inbox. To cancel by mail or for any other subscription issues, write us at: Manward Press | Attn: Member Services | [14 West Mount Vernon Place | Baltimore, MD 21201](#) North America: [1.800.682.5210](#) | International: [+1.443.353.4263](#) Website: [manwardpress.com]( Keep the emails you value from falling into your spam folder. [Whitelist Total Wealth](. © 2024 Manward Press, LLC | All Rights Reserved Nothing published by Manward Press, LLC should be considered personalized investment advice. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed personalized investment advice. We allow the editors of our publications to recommend securities that they own themselves. However, our policy prohibits editors from exiting a personal trade while the recommendation to subscribers is open. In no circumstance may an editor sell a security before subscribers have a fair opportunity to exit. The length of time an editor must wait after subscribers have been advised to exit a play depends on the type of publication. All other employees and agents must wait 24 hours after publication before trading on a recommendation. Any investments recommended by Manward Press, LLC should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company. Protected by copyright laws of the United States and international treaties. The information found on this website may only be used pursuant to the membership or subscription agreement and any reproduction, copying or redistribution (electronic or otherwise, including on the world wide web), in whole or in part, is strictly prohibited without the express written permission of Manward Press, LLC, 14 West Mount Vernon Place, Baltimore, MD 21201.